THOMAS  P.  O’NEILL,  JR. 
LIBRARY 

BOSTON  COLLEGE 


Gift  of 


Everett  C.  Hughes 


THE  SOUTH  SEA 
BUBBLE  -  BY  lewis 

MELVILLE 


BOSTON 

SMALL,  MAYNARD  &  COMPANY 

PUBLISHERS 


H  F 

ij?U 

.  sr 

tv.  3 


Printed  in  Great  Britain  by 
Butler  &  Tanner, 
Frome  and  London 


WR23  m 


O’NffLL  LIBRARY 

boston  college 


CO 


O 


South  Sea  House 


THE  SOUTH  SEA  BUBBLE 


PREFACE 


THOUGH  two  centuries  have  passed  since  it  was 
inaugurated,  the  story  of  the  rise  and  fall  of  the 
South  Sea  Company  has  not  hitherto  been  told  in  detail. 
Yet  in  all  contemporary  memoirs  it  bulks  even  more 
largely  than  the  rebellion  of  ’15,  and  it  certainly  had  con¬ 
sequences  more  far-reaching.  It  has,  further,  its  human 
interest,  insomuch  as  it  is  one  of  the  most  amazing 
instances  of  credulity,  exhibited  at  one  and  the  same 
time  in  all  classes  of  society,  in  the  history  of  the  nation. 
There  have,  of  course,  been  many  other  cases  before  and 
since,  but  none  parallel  with  this.  In  1825  there  was  a 
great  promotion  of  industrial  companies,  the  shares  of 
which  rose  to  prices  that  bore  no  relation  to  value  ;  and, 
later,  there  was  the  railway  mania,  with  George  Hudson 
as  the  leading  spirit,  when  speculation  was  so  madly 
indulged  in,  that,  in  the  year  1847,  the  depreciation  in 
the  shares  of  the  ten  principal  companies  was  calculated 
to  be  not  less  than  £78,000,000.  In  recent  times,  too, 
there  have  been  4  booms,’  followed  by  the  inevitable 
4  slump,’  and  many  who  gambled  in  the  rubber  market 
must  rue  the  day  when  they  took  a  hand  in  a  game  of 
the  principles  of  which  they  were  ignorant. 

The  story  of  the  South  Sea  Company  is  simply  the 
old,  old  story  of  Captain  Rook  and  Mr.  Pigeon.  F ounded 
by  Robert  Harley  (who  was  created  Earl  of  Oxford)  in 

1711,  nine  years  later  it  took  over  the  National  Debt 

•  • 

Vll 


PREFACE 


•  •  • 

Vlll 

on  terms  hopelessly  disadvantageous  to  itself.  Yet  the 
scheme  was  so  vast  that  its  drawbacks  were  overlooked 
by  many;  and  those  who,  ignorant  of  financial  matters, 
invested  in  it  could  at  least  plead  in  mitigation  of  their 
folly  that  it  was  sanctioned  by  Government.  Its  £100 
stock  stood  in  January,  1720,  at  a  little  above  par  ;  in 
August,  as  the  result  of  the  manipulations  of  unscru¬ 
pulous  Directors,  it  was  quoted  at  over  £1,000  ;  in 
December  it  had  fallen  to  £125.  A  few  acute  specula¬ 
tors  made  fortunes,  and  among  these  was  Robert  Wal¬ 
pole,  who  bought  at  a  low  price  and  sold  at  the  top  of 
the  market,  netting  many  tens  of  thousands  of  pounds. 
Persons  in  all  ranks  of  society  were  left  penniless.  The 
Duke  of  Portland  had  to  sue  for  the  Governorship  of 
a  distant  colony,  and  held  himself  fortunate  when  his 
request  was  granted  ;  Samuel  Chandler,  the  Noncon¬ 
formist  divine,  had  to  retrieve  his  fortunes  by  opening 
a  bookseller’s  shop  in  the  Poultry.  Thousands  of 
humble  homes  were  ruined. 

If  it  had  been  the  folly  and  ignorance  of  the  public 
that  had  brought  about  the  disaster,  it  would  have  been 
bad  enough  ;  but,  as  a  matter  of  fact,  it  was  far  worse. 
There  had  been  bribery,  there  had  been  corruption, 
there  had  been  robbery  as  well  as  jobbery.  The  reputa¬ 
tions  of  many  leading  men  in  the  financial  and  political 
worlds  were  destroyed.  One  Minister  committed  suicide  ; 
the  Chancellor  of  the  Exchequer  and  other  members  of 
the  House  of  Commons  were  found  guilty,  expelled  from 
Parliament,  committed  to  the  Tower,  and  their  estates 
confiscated.  The  Prime  Minister  was  arraigned.  He 
was,  indeed,  acquitted,  but  only  by  G1  votes,  and,  since 
no  statesman  with  any  sense  of  decency,  whom  172 
members  of  the  House  of  Commons  openly  declared 
they  believed  guilty  of  fraud,  could  even  in  an  early 


PREFACE 


IX 


decade  of  the  eighteenth  century  contrive  decently  to 
hold  office,  he  had  shortly  to  resign.  He  never  again 
took  a  prominent  part  in  the  affairs  of  the  nation.  The 
King  himself  was  reviled  for  his  support  of  the  Company, 
of  which  he  was  the  Governor  ;  and  when  it  became 
known  that  the  influence  of  his  favourites  at  Court  had 
been  bought  by  illegal  gifts  of  stock  by  which  they 
might  profit  and  could  not  lose,  the  indignation  was  so 
deep  that  if  the  Pretender  had,  as  Atterbury  wished, 
landed  again  in  England,  it  is  not  beyond  the  bounds  of 
possibility  that  the  Stuart  dynasty  might  have  been 
restored. 

The  sources  of  information  concerning  the  rise  and 
fall  of  the  South  Sea  Company  are  numerous.  The 
principal  authorities  are  the  various  Acts  of  Parliament 
relating  to  the  Company,  the  Journals  of  the  Houses 
of  Parliament,  the  Reports  of  the  Committee  of  Secrecy 
appointed  by  the  House  of  Commons  to  investigate  the 
proceedings  of  that  corporation,  the  4  Political  State  of 
Great  Britain,’  Tindal’s  continuation  of  Rapin’s  4  History 
of  England,’  the  4  Parliamentary  History  of  England,’ 
contemporary  pamphlets  by  Defoe  and  others,  and 
Coxe’s  4  Memoirs  of  Sir  Robert  Walpole.’  Interesting 
side-lights  are  to  be  found  in  the  Wentworth  and  Suffolk 
Papers,  the  ‘Journal  to  Stella,’ the  Diary  of  Mary  Lady 
Cowper,  the  correspondence  of  Swift  and  Pope,  and  in 
the  numerous  volumes  issued  by  the  Historical  MSS. 
Commission  (especially  the  Bath,  Buckinghamshire, 
Carlisle,  Clements,  Fortescue,  Ketton,  Onslow,  Portland, 
and  Stuart  MSS.).  Information  may  also  be  gleaned 
from  Macpherson’s  4  Annals  of  Commerce,’  Stanhope’s 
4  History  of  England,’  and  Wright’s  4  Caricature  History 
of  the  Georges.’  Brief  accounts  will  be  found  in  the 
anonymous  pamphlet  (which  is  largely  a  reprint  of 


X 


PREFACE 


passages  from  Macpherson’s  4  Annals  of  Commerce  ’), 
4  The  South  Sea  Bubble  and  the  numerous  fraudulent 
projects  to  which  it  gave  rise  in  1720  historically  de¬ 
tailed  as  a  beacon  to  the  unwary  against  modern  schemes 
equally  visionary  and  nefarious  ’  (1825),  and  in  Charles 
Mackay’s  4  Memoirs  of  Extraordinary  Popular  Delusions  ’ 
(1841).  The  4  Bubble  ’  playing-cards  (a  pack  of  which 
is  preserved  in  the  Print  Department  of  the  British 
Museum)  must  not  be  overlooked  ;  while  some  idea  of 
the  trend  of  public  feeling  may  be  discerned  in  the 
contemporary  prints,  the  best  known  of  which  was 
drawn  by  Hogarth. 

I  am  indebted  to  the  Controller  of  His  Majesty’s 
Stationery  Office  for  permission  to  make  quotations 
from  various  volumes  of  the  reports  of  the  Historical 
Manuscripts  Commission. 


LEWIS  MELVILLE. 


CHAP. 


I 


CONTENTS 


PAGE 

Preface  .......  vii 

Illustrations  .  .  ....  xix 

The  Early  History  of  the  Solttii  Sea  Company, 

1711-1719  .  1 

The  financial  state  of  Great  Britain  in  1711 — The 
national  debts — ‘  The  Earl  of  Oxford’s  Masterpiece  ’ — 
Edward  Harley — The  South  Sea  Act,  1711 — General 
approval  of  the  scheme — The  imagination  of  the  public 
excited — The  stock  fully  subscribed — The  Royal 
Charter — The  first  Governors  and  Directors — Charles 
Lamb’s  description  of  the  South  Sea  House — The 
first  meeting  of  share-holders — ‘  The  South  Sea  Whim  ’ 

— Swift  purchases  stock — Defoe’s  ‘  Essay  on  the 
South  Sea  Trade  ’ — He  exposes  the  inherent  weakness 
of  the  scheme — His  pessimism  justified  by  the  terms 
of  the  Treaty  of  Utrecht — Dissatisfaction  with  the 
terms  granted  by  Spain — Discontent  of  the  stock¬ 
holders  allayed  by  Lord  Oxford — The  Company 
regarded  as  fair  game  by  those  in  high  places — Queen 
Anne  demands  a  share  of  the  profits — The  Company’s 
indignant  protest — The  Queen  reluctantly  withdraws 
her  demand — She  administers  a  crushing  rebuke  to 
the  corporation — The  charges  against  Arthur  Moore — 

Moore  removed  from  the  Board  of  Directors — The 
Governors  and  Directors  in  1715 — The  Company’s  ships 
interfered  with  by  Spain — The  national  credit  in  1717 
— Further  proposals  of  the  South  Sea  Company — 

The  debate  thereon  in  the  House  of  Commons — A 
passage  of  arms  between  Stanhope  and  Walpole — The 
political  morality  of  tho  day — The  Company’s  proposal 
accepted — George  I  succeeds  the  Prince  of  Wales  as 
Governor  of  the  Company — The  first  annual  ship  sails 
— The  second  annual  ship  launched — War  declared 
between  England  and  Spain — Spain  seizes  the  Com¬ 
pany’s  effects  in  South  America. 


xi 


CONTENTS 


CHAP.  PAGE 

II  The  South  Sea  Company  takes  over  the 

National  Debt,  January-Marcii,  1720  .  30 

The  South  Sea  Company  ambitious  to  become  a 
great  financial  corporation — It  obtains  Parliamentary 
sanction  to  redeem  the  tickets  of  the  lottery  of  1719 — 

Its  proposal  to  absorb  the  Bank  of  England  and  the 
East  India  Company  not  entertained — John  Law — 

His  early  life — His  career  in  France — The  Bank 
Generate — The  Bank  Royale — He  founds  the  Missis¬ 
sippi  Company — The  price  of  South  Sea  stock  from 
1711  to  1719 — Sir  John  Blunt — ‘  The  projecting  age  ’ 

— John  Aislabie — James  Craggs  the  elder — The 
Company  makes  proposals  to  take  in  the  national 
debt — An  estimate  of  the  public  liabilities — The 
matter  discussed  in  the  Commons — The  opposition  to 
the  scheme  led  by  Arthur  Brodrick  and  Walpole — 
Anacrimonious  debate — Rivalry  of  the  Bank — ‘  A 
mad  auction  ’ — The  South  Sea  Company’s  scheme 
accepted  by  the  Commons — Walpole  fights  the  scheme 
tooth  and  nail — A  pamphlet  war — Sir  Richard 
Steele’s  ‘  The  Crisis  of  Property  ’ — The  Bill  introduced 
— Debates  in  the  Commons — The  Bill  opposed  in  tlio 
Lords  by  the  Duke  of  Wharton,  Lord  North  and  Grey, 
and  Lord  Cowper,  and  supported  by  Lord  Sunderland 
— The  Bill  receives  the  Royal  Assent — Some  reflec¬ 
tions. 


Ill  The  *  Boom  ’  in  the  Stock  of  the  South  Sea 

Company,  April-July,  1720  ...  53 

Fluctuations  in  the  price  of  the  stock  of  the  South 
Sea  Company — It  rises  steadily  when  Parliament 
approves  the  scheme — A  rage  for  speculation — ‘  The 
demon  of  stock-jobbing  ’ — The  progress  of  Law’s 
Mississippi  Company — Causes  of  the  rise  in  the  price 
of  South  Sea  stock — Extravagant  rumours  circulated 
— First  Money  Subscription  issued  at  £300  per  cent. — 

— Speculators  warned — Second  Money  Subscription 
issued  at  £400  per  cent. — First  Subscription  of  the  na¬ 
tional  debts — The  terms  on  which  the  debts  were  taken 
in — The  disappointment  of  the  Annuitants — They 
are  reconciled  by  a  further  rise  in  the  price  of  stock — 

The  Directors — Their  power  and  their  arrogance — 

‘  Beggars  on  horseback  ' — Bad  news  from  Paris — The 
fall  of  the  Mississippi  Company — Lampoons  on  Law — 

Law’s  opinion  of  the  South  Sea  scheme — His  later  years 
— In  ’Change  Alley — ‘  The  Stock-broking  Ladies  ’ — 
Profit-taking  lowers  the  price  of  South  Sea  stock — 

The  Directors  contrive  to  stay  the  ‘  slump  ’ — Third 
Money  Subscription  issued  at  £1,000  per  cent. — The 
subscribers  as  much  to  blame  as  the  Directors — 


CONTENTS 


CHAP.  PAGE 

Second  Subscription  of  the  national  debts — The  rush 
to  subscribe — The  Annuitants  again  dissatisfied  with 
the  Company’s  terms. 

IV  The  1  Bubble  ’  Companies  of  1720  ...  75 

Many  unauthorised  companies  floated — All  vastly 
over-capitalised — Nearly  a  hundred  ‘  bubbles  ’  with  a 
capital  of  £300,000,000 — Innocent  folk  beguiled  by 
seeing  the  names  of  great  noblemen  as  Governors — 

The  spirit  of  speculation  general — Shares  regarded 
merely  as  gambling  counters — 4  Globe  Permits  ’ — 

Swift  on  the  craze — Warnings  given  and  disregarded — 
Chetwood’s  satires — Practical  jokes — Ridiculous  ob¬ 
jects  of  some  companies — Hobby-horses — Sir  Richard 
Steele — Aaron  Hill — Jezreel  Jones — Sir  Robert  Mont¬ 
gomery — Sir  Richard  Manningham — James  Puckle — 

‘  Bubble  ’  playing-cards — A  list  of  the  4  bubbles  ’ — • 
Insurance  companies — Financial  companies — Land  and 
building  companies — Fishing  companies — Water,  river, 
and  harbour  companies — Metal,  mineral,  and  mining 
companies — Oil,  salt,  and  sugar  companies — Manufac¬ 
turing  companies — Trading  companies — Companies 
trading  to  America  —  Miscellaneous  companies  — 
Fraudulent  promoters  encouraged  by  the  public — Royal 
Exchange  Company  and  London  Assurance  Company 
secure  Parliamentary  sanction — Unauthorised  com¬ 
panies  forbidden  by  a  new  law — A  Royal  Proclamation 
— The  destruction  of  the  4  bubbles  ’ — Disappearance 
of  the  Directors — The  effect  on  ’Change  Alley — The 
fall  in  prices — The  Prince  of  Wales  governor  of  the 
English  Copper  Company  —  The  Lord  Justice’s 
Proclamation — A  writ  of  scire  facias — Ruin  of  the 
share-holders. 

V  The  Slump  in  the  Stock  of  the  South  Sea 

Company,  August-September,  1720  .  .  Ill 

The  reasons  for  postponing  the  fourth  money- 
subscription — Issue  restricted  to  holders  of  capital 
stock — Grievances  of  the  stock-holders — Archibald 
Hutcheson  shows  the  folly  of  purchasing  the  new 
subscription — The  issue  is  fully  subscribed — It  is 
quoted  the  same  day  at  a  premium — The  effect  of  the 
destruction  of  the  4  bubbles  ’  on  the  South  Sea  Com¬ 
pany — Depreciation  of  the  stock — The  Directors’ 
illegal  attempts  to  raise  the  price — General  anxiety 
aroused — Lord  Bathurst  expresses  his  opinion  of  the 
situation — The  Annuitants  demand  unsuccessfully  to 
be  released  from  their  bargains — Dividends  voted  for 
the  next  twelve  years  by  the  Directors — and  confirmed 
by  a  General  Court — Optimistic  speeches  by  James 
Craggs  the  elder,  John  Hungerford,  and  the  Duke  of 


xiv 


CONTENTS 


CHAP.  PAGE 

Portland — Relief  to  the  Annuitants  refused  by  the 
meeting — Concessions  to  stock-holders — Public  dis¬ 
trust  of  the  honesty  of  the  Directors — Another  heavy 
fall  in  the  price  of  the  stock — Arthur  Brodrick’s 
pessimistic  view  of  the  situation — The  Directors 
alarmed — Their  efforts  to  stave  off  ruin — Their 
proposals  to  the  East  India  Company  rejected — A 
conference  with  the  Bank  of  England — A  draft  agree¬ 
ment  submitted — Speeches  at  a  General  Court  of  the 
South  Sea  Company — Sir  John  Fellowes,  the  Sub- 
Governor,  hopeful — Full  powers  to  negotiate  given 
to  the  Directors — Speeches  by  William  Pulteney  and 
Eustace  Budgell — The  latter  refers  to  rumours  that 
the  Directors  have  sold  out  their  holdings  of  stock — 

This  is  denied  by  one  of  the  body  who  was  one  of  the 
worst  culprits  in  this  way — Opinions  of  Pope  and 
Brodrick — Several  goldsmiths,  unable  to  meet  their 
obligations,  abscond — The  Company  makes  great  con¬ 
cessions  to  its  subscribers — The  Directors  charged 
with  breach  of  trust— They  invite  enquiry — Further 
fall  in  the  price  of  stock — Bankruptcy  of  the  Sword- 
blade  Company — Owing  to  the  general  dislocation  of 
credit,  the  Bank  breaks  off  negotiations  with  the 
Company — ‘  All  is  floating,  all  is  falling.’ 


VI  The  Nation  in  Distress,  October-November, 

1720  .  138 

The  South  Sea  Directors  endeavour  to  throw  the 
blame  for  the  collapse  on  the  Bank — The  price  of 
South  Sea  Stock  in  October — A  national  outcry — 

The  demand  for  vengeance — Petitions  to  Parliament — 

No  man  safe  from  suspicion — Rumours  concerning 
Nicholas  Lechmere — The  Directors  condemned  by 
public  opinion — and  attacked  by  pamphleteers  and 
cartoonists — Hogarth’s  ‘  Emblematical  Print  on  the 
South  Sea  Scheme  ’ — Other  prints — South  Sea  ballads 
— The  speculators  as  guilty  as  the  Directors — The  real 
cause  of  their  ruin — Walpole,  Lechmere  and  others 
made  fortunes — The  rise  of  a  plutocracy — Some  who 
might  have  made  fortunes — William  Pulteney  and 
James  Windham — All  sorts  and  conditions  of  people 
ruined — The  effect  upon  the  fashionable  watering- 
places  and  the  metropolis — The  Ear^  of  Strafford — 

Lord  Harcourt — The  Dukes  of  Wharton,  Bolton  and 
Portland — Lord  Chetwynd  and  Lord  Irvine — The 
discontent  so  great  that  Atterbury  proposes  a  Jacobite 
rising — The  Pretender  on  the  ‘  Bubble  ’ — The  King 
and  Lord  Sunderland  summoned  from  Hanover — The 
country  calls  for  Walpole  to  save  it — The  arrival  of  the 
King  in  England — Walpole  prepares  a  scheme. 


CONTENTS 


XV 


CHAP. 

VII  Walpole’s  Proposals  for  Restoring  the 
Public  Credit,  December,  1720 

The  King  in  person  opens  Parliament — Reference 
to  the  catastrophe  in  the  Speech  from  the  Throne — 
The  Address  moved  by  William  Pulteney  and  Henry 
Pelham — Shippen  denounces  the  Directors  and  their 
associates — He  is  supported  by  Sir  William  Wyndham 
and  Lord  Molesworth — The  words  ‘  for  punishing  the 
authors  of  our  present  misfortunes  ’  inserted  in  the 
Address — The  Directors  ordered  to  submit  their 
accounts  to  the  Commons — Walpole's  plan  to  restore  the 
public  credit  based  upon  Jacombe’s  scheme — Walpole’s 
reluctance  to  take  any  part  in  the  proceedings — The 
plan — Walpole’s  explanation  of  it — The  House  resolves 
that  all  contracts  with  the  South  Sea  Company  continue 
in  their  present  state — Opinions  of  the  plan — Brodrick, 
Thomas  Harley,  and  David  Pulteney. 


VIII  Parliamentary  Measures,  January,  1721 

The  ill-practices  of  the  Directors — They  are  for¬ 
bidden  to  leave  the  country — Indignation  of  James 
Craggs  the  younger — The  Directors’  Bill — A  Com¬ 
mittee  of  Secrecy  appointed  to  investigate  the  conduct 
of  the  managers  of  the  Company — Election  of  the 
Committee — List  of  the  members — Particulars  of  the 
Directors’  Bill — It  receives  the  Royal  Assent — Discus¬ 
sion  in  the  Lords — The  Duke  of  Wharton  makes  an 
attack  on  the  Directors — Lord  Stanhope  proposes 
the  confiscation  of  the  estates  of  the  guilty  parties 
— The  Lords  examine  the  Directors  and  pass  Reso¬ 
lutions  condemning  their  acts — Robert  Knight,  the 
Treasurer  of  the  Company,  absconds — His  letter  of 
farewell — Knight  an  important  witness — His  flight 
supposed  to  have  been  prompted  by  interested  parties — 
The  Commons’  Address  to  the  King  to  secure  the 
apprehension  of  Knight — Some  Directors  and  Officers 
of  the  Company  arrested — Resignation  of  Aislabie, 
Chancellor  of  the  Exchequer — Sir  John  Pratt  succeeds 
him — A  reward  offered  for  Knight — Negotiations  with 
the  Emperor  for  his  return — Knight’s  later  career — 
‘  The  Brabant  Screen*’  a  cartoon  with  verses. 


IX  The  Committee  of  Secrecy,  February,  1721  . 

The  Lords  proceed  with  their  investigations — They 
order  five  Directors  into  custody — The  Lords’  Resolu¬ 
tions — A  summary  of  the  malpractices  of  the  Directors 
— Sir  John  Blunt  largely  responsible  for  the  disaster — 
Pope’s  lines  on  Blunt — The  Duke  of  Wharton’s  attack 


PAGE 

170 


187 


204 


xvi 


CONTENTS 


CHAP. 


X 


on  Lord  Stanhope — Lord  Stanhope’s  reply — His 
death — The  Engrafting  Bill — Lord  Townshend  suc¬ 
ceeds  Stanhope  as  Secretary  of  State — First  Report 
of  the  Committee  of  Secrecy — A  terrible  revelation — 
Edward  Hastings’  comment  on  the  disclosures — 

‘  Never  was  such  a  set  of  felons  got  together  ’ — The 
new  Directors — The  difficulties  that  had  confronted 
the  Committee — False  entries  in  books — Reluctant 
witnesses — ‘  A  scene  of  iniquity  and  corruption  ’ — 
Illegal  acts  of  the  Directors — Fictitious  stock — Names 
of  the  recipients — Lord  Sunderland,  Duchess  of  Ken¬ 
dal,  Lady  Darlington,  James  Craggs  the  elder,  Charles 
Stanhope,  etc. — Aislabie  also  involved — Death  of 
James  Craggs  the  younger — Carteret  succeeds  him  as 
Secretary  of  State — Pope’s  eulogy  of  Craggs — Pope  an 
investor  in  South  Sea  stock — John  Gay  and  Matthew 
Prior  also  interested  in  the  Company — Resolutions  of 
the  House  of  Commons  concerning  the  South  Sea 
Company. 


The  Fate  of  the  Directors  and  their  Associ¬ 
ates,  March-April,  1721  . 

Second  Report  of  the  Committee  of  Secrecy — The 
case  of  Charles  Stanhope  considered  by  the  Commons — 
Stanhope’s  defence — He  escapes  condemnation  by 
three  votes — Indignation  of  Thomas  Brodrick  at  the 
acquittal — Anger  of  the  public — Walpole  said  to  have 
undertaken  to  screen  Lord  Sunderland  and  the  Court 
ladies — Aislabie  and  James  Craggs  the  elder  to  be 
made  scapegoats — Aislabie’s  career — Arthur  Onslow’s 
account  of  him — His  case  considered  by  the  Commons — 
Overwhelming  proofs  of  his  guilt — He  is  expelled 
the  House  and  committed  to  the  Tower — His  for¬ 
tune  partly  to  be  confiscated — Aislabie  and  Walpole — 
Aislabie’s  appeal  to  the  Lords — His  unsatisfactory 
defence — The  Lords  approve  the  decision  of  the 
Lower  Chamber — Sir  George  Caswell  condemned — 
He,  too,  is  expelled  the  House  and  committed  to  the 
Tower,  and  his  estates  confiscated — Public  joy 
evinced  at  these  convictions — Aislabie  cartooned — 
‘  The  Ass  and  the  Thistle  ’ — The  case  of  Lord  Sunder¬ 
land — Walpole’s  efforts  on  his  behalf — Arthur  Brod- 
rick’s  account  of  the  proceedings  in  the  Commons — A 
motion  condemning  Lord  Sunderland  negatived  by 
233  to  172  votes — The  Prince  of  Wales’s  followers  vote 
against  him — Evidence  of  his  innocence — Opinions 
of  Sir  John  Vanbrugh,  Arthur  Onslow,  etc. — Death 
of  James  Craggs  the  elder — His  career — His  vast 
fortune  partly  confiscated 


PAGE 


220 


CONTENTS  xvii 


XI  The  Restoration  of  the  Public  Credit,  May- 

August,  1721  ......  237 

General  demand  for  a  Bill  to  relieve  the  South  Sea 
sufferers  and  to  restore  the  public  credit — Resignation 
of  Lord  Sunderland — Walpole  becomes  Prime  Minister 
— The  country  and  the  new  minister — Debates  in  the 
Commons  —  Speeches  of  Shippen  and  Walpole  — 
Shippen’s  ‘  odious  comparison  ’ — The  remitting  to  the 
Company  of  the  £7,000,000  due  to  the  nation — 
Valuation  of  the  South  Sea  Directors’  estates — The 
estates  confiscated  for  the  relief  of  the  sufferers — 
Allowances  made  to  the  Directors  and  Officers  of  the 
Company — Table  of  the  value  of  the  estates  and  the 
grants — Arthur  Brodrick  laments  the  leniency  of  the 
Commons — Edward  Gibbon,  the  historian,  inveighs 
against  the  penalty  imposed  on  his  grandfather — His 
arguments  examined — Directors  penalised  according 
to  their  guilt — National  jubilation  thereat — ‘  The 
Sail-Bird  ’ — The  South  Sea  Sufferers’  Bill  receives 
the  Royal  Assent — A  special  session  of  Parliament — 
Resolutions  upon  which  was  based  a  Bill  to  restore 
public  credit — Petition  from  the  Annuitants — A 
tumult — The  Bill  becomes  law — and  receives  the 
Royal  Assent — The  Speech  from  the  Throne. 

L’Envoi  ........  255 


Index 


259 


ILLUSTRATIONS 


South  Sea  House  .....  Frontispiece 

PAGE 

Robert  Harley,  Earl  of  Oxford  ....  2 

George  I  .  .  .  .  .  .  .  .26 

John  Law.  ........  32 

South  Sea  Bubble  .......  55 

The  Paris  ‘  Bubble  ’  ......  64 

Bubble  Playing-Cards.  I  .....  76 

Bubble  Playing-Cards.  II  .  .  .  .86 

James  Craggs  the  Elder  .  .  .  .  .118 

Sir  Nicholas  Lechmere  .  .  .  .  .  .139 

Francis  Atterbury,  Bishop  of  Rochester  .  .168 

Horace  Walpole,  afterwards  Earl  of  Orford  .  182 

James,  first  Earl  of  Stanhope  ....  194 

James  Craggs  the  Younger  .....  218 

Charles,  third  Earl  of  Sunderland  .  .  .  230 

Monument  Dedicated  to  Posterity,  1720  .  ■  236 


xix 


CHAPTER  I 


The  Early  Years  of  the  South  Sea  Company 

1711-1719 


WHEN  Robert  Harley1  became  Chancellor  of  the 
Exchequer  in  August,  1710,  he  was  at  once 
confronted  with  the  necessity  of  putting  the  finances 
of  the  nation  upon  an  improved  basis.  Before  he  had 
been  in  office  for  many  months  the  matter  had  become 
urgent.  Public  credit,  already  severely  strained  by 
the  expenses  of  the  war,  had  been  further  affected  by 
the  dismissal  of  the  Whig  ministry  ;  while  the  likelihood 
of  an  early  discharge  of  the  country’s  debts  was  so 
remote  as  to  have  occasioned  a  heavy  fall  in  the  prices 
of  the  securities  ;  the  Navy,  Victualling,  and  Trans¬ 
port  bills  being  actually  at  a  discount  of  forty-five  per 
cent.  For  the  general  good  of  the  community,  and 
incidentally  to  secure  some  measure  of  popularity  for 
the  Government,  it  was  essential  that  provision  should 
at  once  be  made  for  discharging  the  National  Debt, 
which  amounted  to  more  than  £9,000,000 — then  regarded 
as  an  enormous  sum. 

On  March  7,  1711,  Harley  informed  the  House  of 
Commons  that  the  question  of  making  provision  for  the 

1  Robert  Harley  (1061-1724),  created  Earl  of  Oxford,  May 
23,  1711,  when  he  exchanged  the  office  of  Chancellor  of  the 
Exchequer  for  that  of  Lord  High  Treasurer. 


2 


THE  SOUTH  SEA  BUBBLE 


debt  was  under  consideration  ;  but  the  discussion  was 
perforce  postponed,  as  on  the  next  day  the  Minister  was 
stabbed  in  the  breast  by  the  Marquis  of  Guiscard,  who 
was  being  examined  on  a  charge  of  treason  by  the  Privy 
Council,  and  he  was  confined  to  his  room  for  some  weeks. 
In  the  meantime  his  brother,  Edward,1  proceeded  to 
work  out  the  scheme,  presently  to  be  known  as  ‘  the  Earl 
of  Oxford’s  Masterpiece,’  and  Harley  had  sufficiently 
recovered  by  May  2  to  be  able  to  submit  it  to  Parlia¬ 
ment.  He  stated  that,  in  the  circumstances,  capitalists 
were  reluctant  to  advance  money  at  the  usual  rates,  and 
it  was  obvious  that  exceptional  advantages  must  be 
offered.  His  plan  to  satisfy  the  proprietors  of  all 
national  debts  was  to  allow  them  six  per  cent,  interest, 
redeemable  by  Parliament  at  one  year’s  notice  after 
Christmas,  1716,  and  secured  on  the  duties  on  wine, 
vinegar,  tobacco,  East  India  goods,  wrought  silk,  whale- 
fins,  and  certain  other  articles,  and  to  incorporate  them 
to  carrv  on  a  trade  to  the  South  Sea.  If  once  settled, 
he  declared  with  enthusiasm,  this  trade  would  bring 
to  Great  Britain  vast  riches  from  Peru  and  Mexico. 
The  proposal  was  keenly  debated,  but  the  main  idea  was 
approved,  and  a  Bill  brought  in  on  May  18,  1711,  quickly 
passed  both  Houses  and  received  the  Royal  Assent. 

In  order  clearly  to  understand  the  scheme,  it  is 
necessary  to  print  the  principal  clauses  of  the  Bill : — 

‘  To  the  intent  that  the  trade  to  the  South  Sea  may  be 
carried  on  for  the  honour  and  increase  of  the  wealth  and  riches 
of  this  realm,  Her  Majesty  is  hereby  empowered  to  incorporate 


1  Edward  Harley  (1664-1735),  M.P.  for  Leominster,  1698- 
1722.  In  1702  he  was  appointed  Auditor  to  the  Exchequer, 
which  post  he  held  for  life.  He  wrote  k  The  Memoirs  of  the 
Harley  Family,’  which  have  been  printed  by  the  Historical 
MSS.  Commission  in  the  Portland  MSS.,  vol.  V. 


Robert  Harley,  Earl  of  Oxford 


From  a  painting  by  Sir  Godfrey  Kneller 


p.  2 


EARLY  YEARS  OF  THE  COMPANY 


3 


all  the  proprietors  of  the  said  debts,  in  the  usual  style  and  form. 
This  Act  allows  the  Company  £8,000  per  annum  for  charges 
of  management.  And,  for  better  securing  the  privileges  of 
the  Bank  of  England,  this  new  Company  shall  not  borrow  money 
on  their  bills  or  notes  on  demand,  nor  at  any  less  time  than 
six  months  :  neither  shall  they  discount  bills  of  exchange,  nor 
any  other  bills  or  notes  whatsoever  ;  nor  shall  they  keep  any 
books  or  cash  for  any  persons  or  corporations,  excepting  their 
own  alone. 

‘  And  whereas  it  is  of  the  greatest  consequence  to  the  honour 
and  welfare  of  this  Kingdom,  and  for  the  increase  of  the  strength 
and  riches  thereof,  and  for  vending  the  product  and  manu¬ 
facture,  goods  and  merchandise  of,  or  brought  into,  this  King¬ 
dom,  and  the  employment  of  the  poor,  that  a  trade  should  be 
carried  on  to  the  South  Seas  and  other  parts  of  America,  herein¬ 
after  mentioned,  which  cannot  so  securely  and  so  successfully 
be  begun  and  carried  on  as  by  a  corporation  with  a  joint 
stock,  exclusive  of  all  others.  For  the  better  encourage¬ 
ment  of  the  members  of  the  said  intended  company,  be  it 
enacted  : 

4  That  this  Company  shall,  from  the  1st  of  August,  1711,  be 
vested  for  ever  in  the  sole  trade  and  traffic,  unto  and  from  all 
the  kingdoms,  lands,  islands,  cities,  towns,  ports,  creeks,  and 
places,  in  America,  on  the  east  side  thereof,  from  the  river  of 
Orinoco  to  the  southernmost  part  of  Terra  del  Fuego  ;  and  on 
the  west  side  thereof,  from  the  southernmost  part  of  the  said 
Terra  del  Fuego,  through  the  South  Seas,  to  the  northernmost 
part  of  America  ;  and  into,  unto,  and  from  all  countries,  etc., 
within  the  said  limits,  which  are  reputed  to  belong  to  the  crown 
of  Spain,  or  which  shall  hereafter  be  found  out  or  discovered 
within  the  said  limits,  not  exceeding  three  hundred  leagues 
from  the  continent  of  America,  between  the  southernmost  part 
of  Terra  del  Fuego  and  the  northernmost  part  of  America,  on 
the  west  thereof,  except  the  kingdom  of  Brazil,  and  such  other 
places  on  the  said  east  side  of  America  as  are  now  in  the  actual 
possession  of  the  crown  of  Portugal,  and  the  country  of  the 
Surinam  in  the  possession  of  the  States- General  of  the  United 
Provinces  ;  it  not  being  intended  that  the  sole  trade  to  any 
part  of  the  east  side  of  America,  now  in  the  actual  possession 
of  the  crown  of  Portugal  or  the  States-General,  shall  be  granted 
by  this  Act  :  but  it  shall  be  and  remain  lawful  for  all  Her 
Majesty’s  subjects  to  trade  and  traffic  thither,  as  full  and 
freely,  in  all  respects,  as  they  might  or  could  do,  if  this  Act 
had  not  been  made. 


4 


THE  SOUTH  SEA  BUBBLE 


4  None  shall  trade  within  those  limits,  but  the  Company, 
their  agents,  and  factors. 

4  The  Queen  may,  in  her  intended  charter  of  incorporation, 
empower  the  said  Company  to  make  laws  for  the  good  govern¬ 
ment  of  their  trade,  etc.,  and  to  inflict  reasonable  penalties, 
by  imprisonment  and  mulcts,  for  any  breach  thereof. 

4  Forfeiture  of  ships  and  merchandise,  and  double  their 
value,  for  any  but  the  Company,  or  those  licensed  by  the 
Company,  trading  to,  or  frequenting,  any  part  of  their  limits  ; 
one -fourth  to  the  Crown,  one -fourth  to  the  informer,  and  one- 
half  to  the  Company. 

4  The  Company  to  be  the  sole  owners  and  proprietors  of  all 
islands,  forts,  towns,  and  places  which  they  shall  hereafter 
discover  within  their  limits  ;  to  hold  the  same  of  the  Crown, 
in  free  and  common  soccage  by  fealty,  on  the  annual  rent  of 
an  ounce  of  gold,  if  demanded. 

4  All  prizes  of  ships  and  merchandise,  taken  by  the  Company, 
shall  be  their  sole  property  :  for  which  end,  they  may  seize 
by  force  of  arms  the  persons,  with  their  ships  and  goods,  trading 
within  their  limits. 

4  The  Company’s  bond  shall  charge  as  well  their  annual  fund, 
as  their  other  stock  effects,  and  estate  ;  and  shall  be  assignable  by 
endorsement.  And  it  shall  be  felony  to  counterfeit  this  com¬ 
mon  seal  or  bonds,  or  to  alter  or  utter  the  same  knowingly. 

4  The  Company  not  to  sail  into  any  of  the  before-named 
limits  beyond  Terra  del  Fuego,  except  only  through  the  Straits 
of  Magellan,  or  else  round  the  said  Terra  del  Fuego  ;  nor  shall 
sail  from  thence  unto  any  part  of  the  East  Indies  ;  nor  shall 
they  return  to  Great  Britain  or  to  any  other  part  of  Europe, 
Asia,  Africa,  or  America,  by  any  other  way  except  through 
the  said  Straits  of  Magellan,  or  by  Terra  del  Fuego  aforesaid  : 
neither  shall  they  trade  in  the  goods  of  India,  Persia,  or  China, 
nor  in  any  other  commodities  of  the  countries  within  the  limits 
of  the  East  India  Company.  Nor  shall  this  new  Company’s 
ships  sail  farther  west  than  the  shores  of  Chili,  Peru,  Mexico, 
California,  or  any  other  shores  contained  between  Terra  del 
Fuego  and  the  northernmost  part  of  America,  than  three 
hundred  leagues  ;  under  forfeiture  of  ships  merchandise,  and 
double  the  value  :  one-third  to  the  Crown,  and  two-thirds  to 
the  East  India  Company. 

4  And  forasmuch  as  nothing  can  more  conduce  to  the  increase 
of  the  strength  and  riches  of  this  kingdom,  and  the  breeding 
of  able  seamen,  than  preserving  and  enlarging  the  fishery,  the 
Queen  may,  in  her  Charter  to  this  Company,  direct  a  stock  of 


EARLY  YEARS  OF  THE  COMPANY 


5 


£20  upon  every  £100  of  the  capital  stock  of  the  Company,  to 
be  kept  apart,  and  always  employed  for  carrying  on,  improving 
and  enlarging,  the  fishery  of  this  realm,  or  any  other  fishery  ; 
so  as  none  other  of  the  Queen’s  subjects  be  excluded  the  fishing 
trade.  And  as  no  calls  of  money  for  the  fishery,  or  for  any 
other  parts  of  the  Company’s  trade,  be  made  but  by  order 
of  a  General  Court,  on  a  fortnight’s  notice. 

4  Neither  the  Governors  nor  Directors  of  this  Company  shall 
be  capable  of  being  such  in  the  Bank  [of  England],  nor  in  the 
East  India  Company,  at  the  same  time.’ 

The  scheme  fired  the  imagination  of  the  British  people, 
and  the  general  public  was  anxious  to  participate  in 
the  benefits  which,  in  its  ignorance,  it  felt  sure  must 
accrue  from  it.  4  Nor  were  the  merchants  slow  in 
swallowing  this  gilded  bait,  and  the  fancied  Eldorado 
which  shone  before  them  dazzled  even  their  discerning 
eyes,’  Stanhope  has  written.  4  The  exploits  of  Drake 
were  quoted,  and  the  dreams  of  Raleigh  revived.  This 
spirit  spread  through  the  whole  nation,  and  many,  who 
scarcely  knew  whereabouts  America  lies,  felt  neverthe¬ 
less  quite  certain  of  its  being  strewed  with  gold  and 
gems.’ 1  To  fan  the  flame  came  the  rumour  that  Spain 
would  cede  to  England  four  ports  on  the  coasts  of  Chili 
and  Peru,  and  folk  at  home  saw  themselves  exchanging, 
at  enormous  profit,  their  manufactured  goods  for  the 
wealth  of  the  mines  of  Potosi  and  Mexico. 

On  June  27  a  Commission  was  signed  directing  that 
the  persons  therein  named,  or  any  five  or  more  of  them, 
should,  as  soon  as  conveniently  might  be,  provide  one 
or  more  books  for  taking  subscriptions  to  the  joint  or 
capital  stock  of  the  Corporation,  to  be  erected  in  pursu¬ 
ance  of  a  late  Act  of  Parliament,  for  carrying  on  a  trade 
to  the  South  Seas ;  that  the  said  Commissioners 
should  provide  a  convenient  house  to  be  the  office  or 


1  History  of  England ,  II.,  3. 


6 


THE  SOUTH  SEA  BUBBLE 


offices  ;  and  at  the  said  offices  such  subscription  books 
should  lie  open  every  day,  except  Sundays,  from  eight 
to  twelve  in  the  morning,  and  from  three  to  six  in 
the  afternoon,  until  July  7,  unless  the  whole  subscription 
to  the  said  capital  stock  should  be  sooner  completed. 

The  Commissioners  thereupon  began,  on  June  29, 
to  receive  subscriptions  at  Mercer’s  Hall,  Cheapside,  in 
the  City  of  London,  but  owing  to  the  time  occupied  in 
examining  the  title  of  the  bills  and  debentures,  only 
£2,000,000 'was  subscribed  by  July  7.  The  period  for 
subscribing  was  then  extended  to  the  end  of  the  month, 
by  when  another  £2,000,000  of  stock  had  been  taken 
up.  4  It  is  remarkable,’  a  contemporary  writer  stated, 
4  that  £2,000,000  are  ready  to  be  subscribed  for  the  use 
of  the  public  as  soon  as  the  accounts  of  the  various 
offices  are  made  up,  so  that  it  may  be  computed  that 
£6,000,000  are  as  good  as  subscribed  ;  and  there’s  no 
doubt  but  the  £3,500,000  remaining  will  also  come  in 
as  soon  as  the  subscription  and  transfer  books  are 
opened.  Upon  the  whole  matter  the  bringing  so  great 
an  undertaking  so  near  perfection  in  so  short  a  time  may 
well  be  reckoned  among  the  wonders  of  Her  Majesty’s 
most  glorious  reign.’ 1 

The  last  step  in  the  inauguration  of  Harley’s  scheme 
was  a  Royal  Charter,  dated  September  8,  1711,  which 
incorporated  the  subscribers  of  the  debt  by  the  name 
of  the  Governor  and  Company  of  Merchants  of  Great 
Britain  trading  to  the  South  Seas  and  other  parts  of 
America.  It  ordained  that  the  Company  should  have 
a  Court  of  Directors,2  and  appointed  the  manner  of  the 
proceedings  in  that  Court  and  in  the  General  Courts, 

1  Political  State  of  Great  Britain ,  I.,  448. 

2  The  qualification  for  a  Governor  was  £10,000  ;  for  a 
Director,  £10,000  ;  for  a  vote,  £1,000. 


EARLY  YEARS  OF  THE  COMPANY 


7 


the  manner  of  elections,  and  the  qualifications  of  the 
electors  and  elected.  It  further  gave  powers  to  the 
Company  to  appoint  courts  of  judicature  in  their  forts, 
factories,  and  settlements,  for  determining  mercantile 
and  maritime  causes,  with  an  appeal  to  the  Queen  in 
Council,  and  to  raise  a  military  force  for  the  defence 
of  their  forts  and  settlements,  as  well  as  to  acquire 
others  within  their  limits.  Immediately  after  the 
Charter  was  issued,  the  election  of  officers  was  proceeded 
with.  Harley,  now  Earl  of  Oxford,  was  appointed 
Governor  ;  Sir  James  Bateman,1  Sub-Governor,  and 
Samuel  Ongley,2  Deputy- Governor  ;  while  the  Directors 
chosen  were  Sir  Robert  Beechcroft,  Robert  Benson,3 
John  Blunt,4  Charles  Blunt,  Sir  Ambrose  Crawley, 
George  Caswell,5  Christopher  Desbouverie,6  Samuel 
Clarke,7  JohnDeacle,8  James  Doliffe,9  Matthew  Decker,10 

1  Sir  James  Bateman,  of  Schobdey  Hall,  Herefordshire 
(d.  1718),  merchant  ;  knighted  in  1701,  in  which  year  he  was 
Sheriff  of  London  ;  M.P.  for  Ilcester,  Somerset,  and  afterwards 
for  Eastlow,  Cornwall. 

2  Sir  Samuel  Ongley,  linen  draper  in  Cornhill,  4  said  to  be 
very  rich,  worth  £10,000  a  year  ’  (Le  Neve  :  Knights,  508). 
He,  with  Christopher  Desbouverie  and  John  Williams,  was 
knighted  on  the  occasion  of  presenting  to  Queen  Anne  an 
Address  from  the  South  Sea  Company,  June  23,  1713. 

3  Robert  Benson  (1676-1731)  succeeded  Harley  as  Chancellor 
of  the  Exchequer,  and  held  that  office  until  1713,  when  he  was 
raised  to  the  peerage  as  Baron  Bingley. 

4  John  Blunt  (d.  1732),  originally  a  scrivener. 

5  George  Caswell,  M.P.  for  Leominster,  knighted  1718. 

6  Christopher  Desbouverie.  See  note  2  (above)  on  Sir 
Samuel  Ongley. 

7  Samuel  Clarke,  London  merchant,  knighted  1712. 

8  John  Deacle,  M.P.  for  Evesham. 

6  James  Doliffe  (d.  1715),  knighted  1714. 

10  Matthew  Decker  (1679-1749),  writer  on  trade,  M.P.  for 
Bishop’s  Castle,  created  baronet  1716.  '  In  1713  became  a 
Director  of  the  East  India  Company  and  retired  from  the 
management  of  the  South  Sea  Company. 


8 


THE  SOUTH  SEA  BUBBLE 


Henry  Durley,  John  Fellowes,  John  Gore,  Edward 
Harley,  Sir  Richard  Hoare,1  Sir  Theodore  Janssen,2 
Sir  John  Lambert,  bart.,  Arthur  Moore,8  Josepli  Martin,4 
Harcourt  Master,5  George  Pitt,6  Henry  St.  John,7  Jacob 
Sawbridge,8  Samuel  Shepherd,9  Francis  Stratford,  Ben¬ 
jamin  Tudman,  Thomas  Vernon,10  John  Williams,11  and 
Sir  James  Wishart.12 

On  August  5,  1712,  Sir  Ambrose  Crawley  became 

1  Sir  Richard  Hoare  (1648-1718),  banker,  knighted  1702; 
Sheriff  of  the  City  of  London,  1709  ;  Lord  Mayor,  1712. 

2  Sir  Theodore  Janssen  (1658-1748),  merchant,  knighted 
1696  ;  created  baronet  1714,  M.P.  for  Yarmouth.  After  the 
4  bubble  ’  burst  in  1720,  the  Duchess  of  Marlborough  bought 
Wimbledon  Manor  from  him. 

3  Arthur  Moore  (1666-1730),  a  Commissioner  of  Trade 
and  Plantations,  1710. 

4  Joseph  Martin,  London  merchant,  knighted  1712. 

5  Harcourt  Master,  only  surviving  son  of  Gyles  Master,  of 
the  Middle  Temple,  London,  was  knighted  1714.  He  was 
Receiver- General  of  the  Land  Tax  for  London  and  Middlesex. 
In  1720  he  married  Lady  Betty  Sidney,  sister  of  the  Earl  of 
Leicester. 

6  George  Pitt,  of  Stratfieldsaye,  Hampshire,  M.P.  for 
Southampton  ;  the  father  of  George  Pitt,  first  Baron  Rivers. 

7  Henry  St.  John  (1678-1751),  Secretary  of  State  1710  ; 
created  Viscount  Bolingbroke,  1712. 

8  Jacob  Sawbridge,  M.P.  for  Cricklade. 

9  Samuel  Shepherd,  M.P.  for  Cambridge. 

10  Thomas  Vernon,  of  Twickenham  Park,  Middlesex.  He 
was  at  one  time  secretary  to  the  Duke  of  Monmouth.  In  1710 
he  entered  Parliament  as  member  for  Whitchurch,  but  on  May 
8,  1721,  was  expelled  from  the  Commons  for  attempted  corrup¬ 
tion.  ‘  He  called  Ross  out  of  the  Committee,  and  told  him 
Aislabie’s  Bill  was  to  come  on,  and  offered  him  a  large  sum, 
which  Ross  refused,  and  then  told  the  House  ’  (Portland  MSS., 
V.,  621).  Whitchurch  re-elected  him  in  1722  and  he  repre¬ 
sented  it  until  his  death  four  years  later.  John  Aislabie 
married  his  sister  Judith. 

11  See  note  on  Sir  Samuel  Ongley,  p.  7,  note  2. 

12  Admiral  Sir  James  Wishart  (d.  1723),  knighted  1704,  a 
Lord  of  the  Admiralty  1710. 


EARLY  YEARS  OF  THE  COMPANY 


9 


Deputy- Governor  in  the  place  of  Samuel  Ongley,  who 
joined  the  Board  of  Directors  ;  and,  among  the  Direc¬ 
tors,  Charles  Blunt,  John  Deacle,  Matthew  Decker. 
John  Gore,  Francis  Stratford,  and  Benjamin  Tudman 
were  replaced  by  William  Astell,  Francis  Acton,  William 
Chapman,  John  Gore,  William  Hammond,  Robert 
Houlditcli,1  and  Thomas  Reynolds.2 

The  South  Sea  Company  now  set  up  house  in  a  massive 
building  at  the  north-east  corner  of  Threadneedle  Street, 
where  it  enters  Bishopsgate  Street,  in  the  City  of 
London.  The  following  description  by  Charles  Lamb  is 
not  of  the  original  building,  which  was  burnt  down 
in  1826,  but  of  the  new  South  Sea  House  which  was 
erected  in  1772-1773,  where  Lamb,  himself,  with  his 
brother,  was  employed  as  a  clerk  towards  the  end  of  the 
eighteenth  century.  4  Reader,5  says  the  great  essayist, 
4  in  thy  passage  from  the  Bank — where  thou  hast  been 
receiving  thy  half-yearly  dividends  (supposing  thou  art 
a  lean  annuitant  like  myself) — to  the  Flower-Pot,  to 
secure  a  place  for  Dalston  or  Shacklewell,  or  some  other 
thy  suburban  retreat  northerly — didst  thou  never  observe 
a  melancholy  looking,  handsome  brick  and  stone 
edifice,  to  the  left,  where  Threadneedle  abuts  upon 
Bishopsgate  ?  I  daresay  thou  hast  often  admired  its 
magnificent  portals  ever  gaping  wide,  and  disclosing  to 
view  a  grave  court,  with  cloisters  and  pillars,  with  few 
or  no  traces  of  goers-in  or  comers-out — a  desolation 
something  like  Balclutha’s.  This  was  once  a  house  of 
trade — a  centre  of  busy  interests.  The  throng  of  mer¬ 
chants  was  here — the  quick  pulse  of  pain — and  here 
some  forms  of  business  are  still  kept  up,  though  the 

1  Robert  Houlditcli,  Treasurer  of  the  Stamp  Office. 

2  Thomas  Reynolds,  a  Commissioner  of  the  Victualling 
Office 


10 


THE  SOUTH  SEA  BUBBLE 


soul  be  long  since  fled.  Here  are  still  to  be  seen  stately 
porticoes,  imposing  staircases,  offices  roomy  as  the 
state  apartments  in  palaces — deserted  or  thinly  peopled 
with  a  few  straggling  clerks  ;  and  still  more  sacred 
interiors  of  Courts  Committee  rooms,  with  venerable 
faces  of  beadles,  door-keepers,  directors  seated  in  form 
on  solemn  days  (to  proclaim  a  dead  dividend),  at  long 
worm-eaten  tables,  that  have  been  mahogany,  with 
tarnished  gilt-leather  coverings,  supporting  massive 
silver  ink-stands  long  since  dry ;  the  oaken  wainscots 
hung  with  pictures  of  deceased  Governors  and  Sub- 
Governors  of  Queen  Anne,  and  the  first  two  monarchs 
of  the  Brunswick  dynasty ;  huge  charts,  which  subse¬ 
quent  discoveries  have  antiquated ;  dusky  maps  of 
Mexico,  dim  as  dreams, — and  soundings  of  the  Bay 
of  Panama  ! — the  long  passages  hung  with  buckets, 
appended,  in  idle  rows,  to  walls,  whose  substance  might 
defy  any,  short  of  the  last,  conflagration  :  with  vast 
ranges  of  cellarage  under  all,  where  dollars  and  pieces- 
of-eight  once  lay,  an  “  unsunned  heap,”  for  Mammon 
to  have  solaced  his  solitary  heart  withal — long  since 
dissipated,  or  scattered  into  air  at  the  blast  of  that 
famous  Bubble.  Such  is  the  South  Sea  House.’ 
At  the  new  offices  of  the  Company  was  held  on 
September  14  the  first  meeting  of  shareholders,  and, 
after  this,  the  concern  could  claim  to  be  successfully 
launched. 

There  were  not  wanting,  even  in  these  early  days, 
those  who  denounced  the  scheme  as  visionary.  4 1 
have  met  here,’  wrote  A.  Carleton,  from  Tunbridge 
Wells,  October  10,  1711,  4  a  pretty  many  Whigs  whose 
inseparable  qualities,  malice  and  hypocrisy,  were  very 
apparent,  some  cunningly,  others  plainly,  lessening  the 
Ministers  and  public  credit,  especially  the  South  Sea 


EARLY  YEARS  OF  THE  COMPANY  11 


Company,  calling  it  a  chimera,  etc.’ 1  Swift  told  4  Stella  ’ 
on  October  27  that  the  Chancellor  of  the  Exchequer  had 
shown  him  a  ballad  in  manuscript  against  the  Lord 
Treasurer  and  his  project.  4  It  is  very  sharply  written,’ 
he  added.  4  If  it  is  not  printed,  I  will  send  it  to  you.’ 2 
It  was  printed,  however,  and  has  been  preserved. 

THE  SOUTH  SEA  WHIM 

To  the  tune  of  ‘  To  you ,  fair  ladies ,  now  at  land ,  etc' 

To  you,  fair  ladies,  now  ashore, 

We  South  Sea  cullies  write, 

Your  kind  compassion  to  implore, 

This  ditty  we  indite  : 

Pity  your  brethren  on  the  main, 

Compell’d  to  change  our  course  in  vain. 

With  a  fa,  la,  etc. 

We  are  a  wretched  motley  crew, 

More  various  than  the  weather, 

Made  up  of  debtors  old  and  new, 

Jumbled  and  rocked  together  ; 

Tars,  soldiers,  merchants,  transport,  tallies, 

Chain’d  in  a  row  like  slaves  in  gallies. 

We  furnish’d  beer,  we  guns  and  balls, 

We  ships  or  money  lent, 

With  hemp  enough  to  serve  them  all  ; 

O  may  it  so  be  spent. 

And  since  his  payments  are  so  few 
Give  Csesar  what  is  Caesar’s  due. 

To  fetch  the  navy  pitch  and  tar, 

We  passed  the  stormy  Sound  ; 

But  now  our  debts  postponed  so  far, 

We  must  take  t’other  round  ; 

And  e’er  we  have  our  own  again 
Must  shoot  the  Straits  of  Magellan. 


1  Portland  MSS.,  V.,  98. 

2  Journal  to  Stella. 


12 


THE  SOUTH  SEA  BUBBLE 


And  we  poor  graziers  of  the  plain, 

Who  served  them  pork  and  beef, 

Must  take  hard  words  instead  of  gain, 

And  charters  for  relief ; 

For  good  sound  meet  with  a  hogo 
They  give  us  bills  on  Ter1  del  Fuego. 

We  honest  tars  that  oft  come  home 
Without  an  arm  or  leg, 

Must  hope  no  more  for  trulls  or  rum, 

But  be  content  to  beg  : 

Our  wages  stopt  without  account 
The'  crew  is  all  turn’d  o’er  to  B - 1. 

Two  scurvy  letters,  R  and  Q, 

Did  long  the  sea  infest, 

Made  some  dispute,  and  proved  their  due, 

But  still  they  paid  their  rest 
This  sweeping  torrent  none  can  stem, 

We’re  run  aground  on  O  and  M. 

But  come,  my  lads,  together  stand, 

Let’s  suffer  this  no  more  : 

Shall  we  that  on  the  seas  command, 

Be  bullied  thus  on  shore  ? 

No,  no,  my  boys,  pull  the  helm  a-lee 
And  heave  the  rogues  into  the  sea. 

On  the  foundation  of  the  South  Sea  Company  Swift 
had  so  far  interested  himself  as  to  use  his  influence 
to  secure  the  election  as  a  Director  of  his  friend 
Francis  Stratford,  and,  shortly  afterwards,  to  decide 
to  invest  in  it.  ‘I  am  resolved,’  he  told  ‘  Stella  ’  on 
November  12,  1711,  4  to  buy  £500  South  Sea  stock, 
which  will  cost  me  £380  ’ — from  which  statement  it  is 
evident  that  the  stock  was  at  this  time  quoted  at  70. 
Another  eminent  man  of  letters,  and  one  who  had  some 
knowledge  of  affairs,  Daniel  Defoe,  interested  himself 
in  the  scheme  and,  before  the  Bill  became  law,  he  had 
already  been  in  correspondence  about  it  with  Oxford. 
In  the  following  year  he  published,  as  4  By  the  Author 


EARLY  YEARS  OF  THE  COMPANY 


13 


of  the  Review ,’  a  pamphlet  styled,  4  An  Essay  on  the 
South  Sea  Trade,  with  an  enquiry  into  the  grounds  and 
reasons  of  the  present  dislike  and  complaint  against  the 
settlement  of  a  South  Sea  Company.’  In  this  brochure 
he  discussed  the  advantages  and  drawbacks  of  the 
scheme,  and  laid  due  stress  upon  the  weakness  of  the 
Company’s  position.  4  The  contrivers  of  this  under¬ 
taking,’  he  wrote,  4  know  too  well  the  temper,  constitu¬ 
tion,  and  state  of  affairs  of  the  Spaniards  in  America,  to 
have  promised  to  themselves,  that  by  any  treaty,  capitu¬ 
lation,  or  stipulation,  either  in  New  Spain  or  Old,  they 
wTill  ever  be  brought  to  lay  open  the  trade  of  their 
Indies  to  the  English,  or  indeed  to  any  nation  in  the 
world.  Perhaps  they  might  be  brought  to  admit  a 
trade  to  particular  places  for  provisions,  fish,  corn,  or 
such  things  as  they  may  more  particularly  want  in 
those  places  for  the  subsistence  of  their  people  :  or,  they 
may  be  brought  to  treat  with  you  for  an  assent  or  per¬ 
mission  to  bring  negroes  to  them,  a  thing  more  proper 
for  the  African  Company  than  for  any  other,  and  the 
reason  for  that  may  be  only  because  they  know  not 
where  else  to  have  them.  But  that  they  will  permit 
you  to  a  free  importation  among  them  of  your  European 
manufactures  and  exportation  of  bullion  from  them  is  so 
contrary  to  the  nature  of  their  trade,  so  destructive  to 
their  own  interest,  and  would  be  so  fatal  to  the  very 
life  and  being  of  the  Spanish  dominions  in  Europe,  I 
mean  as  to  commerce,  that  unless  the  Spaniards  are  to 
be  divested  of  common  sense,  infatuate,  and  given  up, 
abandoning  their  own  commerce,  throwing  away  the 
only  valuable  stake  they  have  left  in  the  world,  and,  in 
short,  bent  to  their  own  ruin,  we  cannot  suggest  that 
they  will  ever,  on  any  consideration,  or  for  any  equiva¬ 
lent,  part  with  so  valuable,  indeed,  so  inestimable  a 


14 


THE  SOUTH  SEA  BUBBLE 


jewel,  as  the  exclusive  power  of  trade  to  their  own 
plantations  in  America.’ 

The  soundness  of  Defoe’s  objection  was  proved  when 
the  terms  of  the  peace  with  Spain,  signed  in  April, 
1713,  were  made  known.  This  treaty  was  far  from 
favourable  to  the  South  Sea  Company.  It  was  very 
easy  for  English  ministers  to  promise  free  trade  with 
Spanish  America,  but  it  was  found  impossible  to  secure 
it.  Philip  V.  would  not  even  seriously  consider  such 
an  encroachment  upon  his  privileges.  In  October,  1711, 
Petkum’s  private  correspondent  at  Paris  had  given  it  as 
his  opinion  that  the  utmost  concession  that  could  be 
wrung  from  Spain  would  be  one  port  in  the  South  Seas, 
with  freedom  of  trade  for  twelve  vessels  ;  1  but  this 
was  more  than  was  ultimately  obtained.  The  Court  of 
Madrid  granted  4  to  her  Britannic  Majesty,  and  to  the 
Company  of  her  subjects  appointed  for  that  purpose,’ 
an  assiento  for  supplying  the  Spanish  colonies  with 
four  thousand  eight  hundred  negroes  yearly  for  thirty 
years  ;  leave  to  the  Company  to  trade  and  settle  factories 
at  Panama,  Portobello,  Cartagena,  Vera  Cruz,  Buenos 
Aires,  and  Havana,  and  to  have  agents  in  Jamaica 
and  at  Cadiz,  Madrid,  and  to  send  yearly  one  ship  of 
less  than  five  hundred  tons — and  even  this  was  per¬ 
mitted  only  on  the  condition  that  the  King  of  Spain 
should  have  the  profits  of  one-quarter  of  the  trade 
and  five  per  cent,  of  the  profits  of  the  other  three- 
quarters. 

Disappointing  as  were  the  terms  of  the  treaty,  there 
was,  however,  no  sign  of  any  loss  of  confidence  in  regard 
of  ultimate  gain  on  the  part  of  the  shareholders,  though 
the  Directors  were  greatly  dissatisfied,  and  at  their 
meetings  voiced  their  feelings  in  strong  terms.  4  As 

1  Round  MSS.,  3G1. 


EARLY  YEARS  OF  THE  COMPANY  15 


soon  as  the  Act  was  passed,  and  the  Company  settled,’ 
Edward  Harley  wrote,  ‘  the  avarice,  ingratitude,  and 
perverseness  of  the  proprietors  of  the  vast  debt  soon 
appeared,  the  majority  of  which,  instead  of  complying 
with  what  was  necessary  for  the  ease  of  the  Government, 
and  the  advantage  of  the  Company,  set  themselves  to 
embarrass  everything  that  was  proposed  for  the  sup¬ 
porting  the  credit  of  this  Company,  and  advancing  their 
real  interest.  This  baseness  fully  appeared  after  the 
Peace  of  Utrecht,  by  which  the  sole  trade  to  the  Spanish 
West  Indies  was  vested  in  this  Company,  exclusive  of 
all  other  nations  except  Spaniards  ;  but  such  was  the 
factious  perverseness  of  some  of  the  Directors,  that  were 
named  by  the  Queen’s  charter,  that  they  often  in  their 
Court  endeavoured  to  represent  the  whole  trade  as 
a  useless,  unprofitable  thing.  The  Auditor  observing 
this,  with  great  indignation  proposed  that  they  should 
immediately  draw  up  a  representation  to  the  Queen  to 
let  her  Majesty  know  their  sitting  there  as  a  Corporation 
was  only  the  keeping  up  a  great  charge  upon  the  Govern¬ 
ment,  without  any  advantage  to  the  nation,  and  that 
therefore  they  should  come  to  a  resolution  to  surrender 
their  Charter  ;  for  if  the  trade  were  of  no  value,  their 
taking  salaries  for  the  management  of  it  was  a  cheat 
and  a  gross  imposition  upon  the  nation,  for  as  to  the 
payment  of  interest  to  the  proprietors,  he  would  under¬ 
take  it  should  be  done  by  two  clerks  for  £200  a  year. 
The  apprehension  of  this  silenced  these  mercenary 
fellows.’ 1 

Active  dissatisfaction  was,  however,  allayed  by  a 
statement  made  by  Oxford  at  a  General  Court  of  the 
proprietors  held  on  June  2,  1713,  that  a  licence  had 

1  Portland  MSS.,  V.,  653 — ‘Memoirs  of  the  Harley  Family, 
by  Edward  Harley.’ 


16 


THE  SOUTH  SEA  BUBBLE 


been  obtained  from  the  King  of  Spain  for  two  ships  of 
six  hundred  tons,  in  addition  to  the  annual  ship,  to 
trade  the  first  year  to  the  northern  ports  of  Spanish 
America,  and  that  the  Queen  would  lend  two  ships  to 
the  Company  to  carry  goods,  factors,  and  servants. 
Upon  the  strength  of  this  concession,  the  Company 
forthwith  raised,  by  bonds,  the  sum  of  £200,000,  to 
be  used  4  for  carrying  on  their  trade  wTith  vigour.’  It 
presently  transpired  that  the  Queen,  when  making  over 
the  assiento ,  had  not  only  made  it  a  charge  on  the 
Company  to  pay  Manuel  Manares  Gullingham,  the 
Spanish  agent  at  the  Court  of  St.  James’s,  seven-and-a- 
half  per  cent,  of  the  profits  resulting  from  the  trade,  but 
had  reserved  to  herself  a  quarter  share  in  the  venture, 
albeit  she  was  not  prepared  to  furnish  an  equivalent 
amount  of  the  cost  of  fitting  out  the  expeditions.  The 
Directors  took  an  early  opportunity  to  make  it  clear 
that  they  did  not  see  the  equity  of  the  arrangement. 

‘  Last  Wednesday,’  Matthew  Decker,  an  ex-Director, 
wrote  to  Thomas  Harley,  February  19,  1714,  4  we  had 
a  General  Court  of  the  South  Sea  Company,  when  was 
laid  before  them  the  assiento  trade,  as  it  was  designed 
by  the  Queen  to  be  given.  Instead  of  joyful  accept¬ 
ing,  there  rose  a  great  many  warm  debates,  mixed 
with  some  reflections,  upon  that  trade,  and  the  conclu¬ 
sion  was  that  the  proposals  of  the  Court  of  Directors 
laid  before  the  General  Court  should  be  printed,  and 
to-morrow  be  given  to  the  members  ;  upon  which  the 
Court  of  Directors  adjourned  to  Wednesday  next.  The 
slight,  for  I  think  I  cannot  call  it  anything  else,  may  be 
repented  by  the  Gentlemen  of  the  South  Sea,  for  it 
is  still  in  the  Queen’s  powers  to  give  it  to  whom  she 
please,  and  if  1  am  well  informed,  something  seems  to 
be  intended  by  the  Court ;  if  so,  it  may  prove  for  the 


EARLY  YEARS  OF  THE  COMPANY 


17 


benefit  of  the  African  Company.’ 1  The  Resolution  of 
the  Directors  ran :  4  That  it  is  the  opinion  of  this 

Court,  that  it  may  be  proper  to  move  the  General 
Court  to  accept  from  Her  Majesty  the  assignment  of 
the  two  licences,  and  of  such  shares  in  the  assiento 
contract  as  by  the  last  draft  of  the  assignment  by  Her 
Majesty  (which  the  Court  of  Directors  have  received) 
are  proposed  to  be  assigned  for  the  use  of  the  Company 
so  as  the  management  of  the  said  assiento  contract 
may  remain  solely  in  the  Company,  and  the  Company 
be  in  all  other  respects  on  the  same  foot  with  the 
assignees  of  the  other  shares  or  parts  of  the  assiento 
contract ;  and  that  such  other  assignees  be  effectu¬ 
ally  obliged  to  secure  the  paying  into  the  Company 
their  proportion  of  the  money  for  carrying  on  the  trade, 
and  that  the  Company’s  accounting  with  such  other 
assignees  be  made  safe  and  easy  to  the  Company.’ 
This  resolution  was  agreed  to  at  the  meeting  of  February 
26  ;  but  an  agitation  was  set  on  foot  to  induce  the  Queen 
to  surrender  her  share  in  the  assiento .  This  was  suc¬ 
cessful,  and  her  reluctant  consent  was  on  June  18 
notified  to  the  Company  by  Bolingbroke.2 *  A  few  days 
later,  the  Company,  pleased  with  this  victory,  pro¬ 
posed  to  present  an  Address  ‘  both  to  return  Her 
Majesty  their  most  humble  thanks  for  her  great  goodness 
in  granting  and  making  over  to  it  the  fourth  part  of  the 
assiento ,  and  most  humbly  to  beseech  Her  Majesty 
that  she  would  be  graciously  pleased  likewise  to  make 
over  to  the  Company  the  seven-and-a-half  per  cent. 

1  Portland  MSS .,  V.,  385. 

2  The  Queen’s  grant  of  her  quarter  share  of  the  assiento  not 

having  been  formally  conveyed  to  the  Company  before  her 

death,  George  I.  confirmed  it  on  his  accession  to  the  throne,  as 
also  that  of  the  four  ships. 


o 


18 


THE  SOUTH  SEA  BUBBLE 


reserved  for  Mr.  Gullingham.’  A  copy  of  this  Address 
was  laid  before  the  House  of  Commons,  but  the 
Ministers,  who  were  asked  to  present  it,  4  did  not  think 
proper  to  charge  themselves  with  it.’  On  July  19,  an 
Address  to  the  Queen,  which  contained  no  reference 
to  the  Spanish  agent,  was  presented  at  Kensington  by 
Samuel  Shepherd,  the  Deputy-Governor  of  the  Com¬ 
pany.  4  Your  Majesty’s  most  dutiful  and  loyal  subjects, 
the  Governor  and  Company  of  Merchants  of  Great 
Britain  trading  to  the  South  Seas  and  other  parts  of 
America,  and  for  encouraging  the  fishery,  in  General 
Court  assembled,’  it  ran,  4  have,  with  great  pleasure 
and  satisfaction,  been  acquainted  by  a  letter  from  the 
Right  Honourable  the  Lord  Viscount  Bolingbroke, 
Your  Majesty’s  Principal  Secretary  of  State,  that,  as  a 
further  proof  of  Your  Majesty’s  goodness,  and  favour¬ 
able  intentions  towards  them,  and  to  encourage  to  the 
utmost  a  vigorous  prosecution  of  the  assiento  trade, 
Your  Majesty  has  graciously  resolved  to  grant  to  this 
Company  the  fourth  part  which,  by  the  assiento ,  you 
had  reserved  to  yourself :  for  which,  as  well  as  for  all 
other  instances  of  your  Royal  favour  and  particularly 
for  Your  Majesty’s  sign  and  manual,  whereby  you  have 
been  graciously  pleased  to  assist  them  with  four  men- 
of-war  for  transporting  to  the  Spanish  West  Indies 
their  factors  and  merchandise,  they  do  (as  they  are 
indispensably  obliged)  return  Your  Majesty  their  most 
dutiful  and  thankful  acknowledgments.  May  God  long 
preserve  Your  Majesty’s  most  valuable  life,  whereon 
the  welfare  of  your  subjects,  and  the  happiness  of 
Europe,  so  much  depends.’  To  this  Address  Her 
Majesty  made  the  crushing  reply  :  4 1  thank  you  for 
your  Address.  I  wish  you  good  success  in  carrying 
on  your  trade,  and  hope  you  will  make  a  better  use 


EARLY  YEARS  OF  THE  COMPANY 


19 


than  you  have  hitherto  done  of  what  I  have  bestowed 
upon  you.’ 

The  rebuke  was  justified  in  so  far  as  the  Company, 
though  three  years  had  elapsed  since  it  was  inaugurated, 
had  not  yet  dispatched  a  ship  to  Spanish  America.  As 
a  matter  of  fact,  however,  it  was  at  this  time  preparing 
an  expedition  ;  but  in  connection  with  this,  misfortune 
after  misfortune  occurred.  Captain  Johnson,  in  com¬ 
mand  of  one  of  the  men-of-war  appointed  to  attend 
the  service  of  the  Company,  was  suddenly  and  unex¬ 
pectedly  superseded ;  whereupon  he  made  to  the 
Directors  a  statement  to  the  effect  that  he  had  been 
removed  from  his  command  for  refusing  to  take  on 
board  his  ship  sixty  tons  of  goods  to  be  delivered  on  a 
private  account.  As  a  result  of  this  communication, 
the  Directors,  on  June  16,  1714,  charged  one  of  their 
number,  Arthur  Moore,  4  with  being  privy  to,  and 
encouraging,  a  design  of  carrying  on  a  clandestine  trade 
to  the  prejudice  of  that  Corporation.’  Moore  denied 
the  accusation,  which  he  stigmatised  as  false  and  mali¬ 
cious  ;  but,  upon  a  committee  of  enquiry  being  ap¬ 
pointed,  he,  1  being  apprehensive  that,  if  any  breach  of 
trust  should  be  made  out  against  him,  he  should  forfeit 
all  the  stock  he  had  in  the  Company,  prudently  thought 
fit  to  transfer  it  next  day.’1  This  was,  not  unnaturally, 
regarded  as  practically  equivalent  to  a  confession  of 
guilt. 

The  matter  made  a  great  noise,  and  four  days  later 
the  House  of  Commons  resolved,  4  That  the  Directors 
of  the  South  Sea  Company  do  lay  before  the  House  an 
account  of  all  proceedings  in  the  said  Company,  relating 
to  the  assiento  trade,  together  with  all  orders,  directions, 
letters,  or  informations,  which  the  Directors,  or  any 
1  Political  State  of  Great  Britain,  VIII.,  540. 


20 


THE  SOUTH  SEA  BUBBLE 


Committee  of  Directors,  had  received  concerning  the 
same,5  and  at  the  same  time  addressed  Her  Majesty, 
praying  4  that  she  would  be  pleased  to  give  directions 
that  an  account  be  laid  before  this  House  of  all  orders 
that  had  been  sent  to  the  Lords  of  the  Admiralty  for 
fitting  any  ships  to  attend  the  service  of  the  South  Sea 
Company  and  what  directions  had  been  given  for 
altering  the  service  for  which  such  ships  wrere  under 
orders,  and  what  representations  had  been  made  by 
the  Admiralty  upon  that  account.5  The  House  of  Lords 
held  an  enquiry,  and  Captain  Johnson,  summoned 
before  it,  4  gave  an  account  how  Arthur  Moore  had 
made  him  meet  at  his  house  Decoster  [Da  Costa  (?)], 
the  Jew,1 2  and  Deodil,  an  Irishman,  to  agree  about 
keeping  storage  for  sixty  tons  of  goods  not  belonging  to 
the  Company  ;  he  scrupling  of,  the  next  news  he  heard 
was  his  ship  was  not  to  go  the  voyage.5  2  Other  things 
to  the  detriment  of  Moore  came  to  light,  but  the  House 
of  Lords  did  not  pass  any  censure  upon  him.  The 
Company,  however,  was  not  content  to  let  the  matter 
slide,  and  on  July  7,  at  a  General  Court,  at  which  nearly 
one  thousand  persons  were  present,  passed  resolutions  : 

4  First,  that  Arthur  Moore,  Esq.,  while  a  Director  of 
this  Company,  was  privy  to,  and  encouraged,  a  design 
of  carrying  on  a  clandestine  trade,  to  the  prejudice  of 
this  Corporation,  contrary  to  his  oath,  and  in  breach 
of  the  trust  reposed  in  him  ;  and,  secondly,  that  the 
said  Arthur  Moore,  Esq.,  for  such  his  breach  of  trust, 
be  declared  incapable  of  being  a  Director  of,  or  having 
any  other  employment  in,  this  Company.5  There  were 

1  Probably  Abraham  (otherwise  John)  Mendes  da  Costa 
(d.  1726),  a  City  merchant,  and  the  father  of  Emanuel  Mendes 
da  Costa,  the  naturalist. 

2  Wentworth  Papers ,  399. 


EARLY  YEARS  OF  THE  COMPANY  21 


many,  however,  who  held  Moore  guiltless. 1 2 3  4  There 
being  no  proof  against  him,  and  the  majority  of  them 
being  Whigs,  we  take  it  to  be  no  discredit  to  him,5  so 
runs  a  passage  in  a  news-letter  of  July  8.1  Bolingbroke 
was  furiously  indignant  at  the  action  of  the  Company  ; 
and  a  modern  writer  has  remarked  that  4  the  charges 
against  Moore  must  be  carefully  discounted  in  view 
of  the  great  hostility  with  which  he  was  regarded,  on 
account  of  his  advanced  views,  by  the  bulk  of  the 
trading  classes.5  2 

In  1715  the  South  Sea  Company  received  the  direct 
patronage  of  royalty,  for  the  Prince  of  Wales  consented 
to  be  nominated  as  Governor.  At  the  elections  in 
February,  Sir  James  Bateman  remained  Sub-Governor, 
and  Sir  Ambrose  Crawley  gave  place  to  Samuel  Shep¬ 
herd  as  Deputy-Governor.  William  Astell,  John  Blunt, 
George  Caswell,  Sir  William  Chapman,  Sir  James  Doliffe, 
Henry  Durley,  John  Fellowes,  John  Gore,  Robert 
Houlditch,  Sir  Theodore  Janssen,  Sir  Harcourt  Master, 
George  Pitt,  Thomas  Reynolds,  and  Jacob  Sawbridge 
were  re-elected  as  Directors  ;  and  the  vacant  places  were 
filled  by  the  Duke  of  Argyll,3  Sir  Lambton  Blackwell,4 
Robert  Chester,  Peter  Delaporte,  Francis  Eyles,  Edward 
Gibbon,5  Francis  Hawes,6  Daniel  Hayes,  Richard  Horsey, 

1  Portland  MSS.,  V.,  471. 

2  W.  P.  Courtney  :  Arthur  Moore  ( Dictionary  of  National 
Biography). 

3  John  Campbell,  second  Duke  of  Argyle  (1678-1743), 
soldier  and  statesman. 

4  Sir  Lambton  Blackwell,  who  was  knighted  in  1697,  subse¬ 
quently  bought  the  lordship  of  Spixworth,  Redham,  Hardley, 
and  other  manors  in  Norfolk. 

5  Edward  Gibbon  (1666-1736),  grandfather  of  the  historian  ; 
merchant ;  for  some  years  a  Commissioner  of  Customs. 

6  Francis  Hawes,  of  Purley  Hall,  Reading,  Cashier  of  the 
Customs  ;  father  of  the  infamous  Lady  Vane. 


22 


THE  SOUTH  SEA  BUBBLE 


Jacob  Jacobsen,1  Charles  Joye,  Ambrose  Page,  Captain 
Hugh  Raymond,  Samuel  Read,  jr.,  Hon.  Horatio  Town- 
shend,  and  Fisher  Trench.2  On  March  15  William 
Hammond,  an  ex-Director,  returned  to  the  Board  in 
place  of  Sir  James  Doliffe,  deceased.  These  gentlemen 
held  office  for  three  years. 

At  last  the  Bedford  and  the  Elizabeth  were  laden 
with  the  Company’s  goods,  by  virtue  of  two  cedulas 
granted  by  the  King  of  Spain  in  1714,  and  they  sailed, 
the  first  to  Cartagena,  the  second  to  Vera  Cruz.  It 
was  then  that  further  trouble  arose.  The  Bedford’s 
cargo  was  confiscated  by  the  authorities  at  the  port  of 
arrival  on  the  pretext  of  over-tonnage,  though  when 
measured  later  it  was  found  that  the  cargo  was  under 
the  stipulated  tonnage  ;  and  the  Company  complained 
bitterly  that,  besides  the  loss  of  their  market,  they  had 
to  pay  heavy  sums  to  the  Spanish  officers  to  obtain 
a  suspension  of  the  cargo,  pending  an  appeal  to  Europe. 
The  case  of  the  Elizabeth  was  nearly  as  bad,  for  at  Vera 
Cruz  a  very  heavy  duty  was  laid  on  the  cargo,  in  spite 
of  the  fact  that  it  had  been  explicitly  exempted  from 
duty  on  condition  that  the  King  of  Spain  should  receive 
ten  per  cent,  of  the  profits.  Such  treatment  certainly 
did  not  encourage  the  Company  to  develop  its  trade 
to  the  South  Sea,  and  there  cannot  be  the  slightest 
doubt  that  this  was  its  object. 

The  credit  of  the  country  in  1717  was  still  far  from 
satisfactory,  and  reference  to  this  state  of  affairs  was 
made  in  the  King’s  Speech  at  the  opening  of  the  session. 

1  Sir  Jacob  Jacobsen,  a  London  merchant.  He  was  the 
father  of  Theodore  Jacobsen,  the  architect  of  the  Found¬ 
ling  Hospital  and  the  Haslar  Royal  Hospital  at  Gosport. 

2  Fisher  Trench,  of  Low  Leyton,  in  Essex  (1672-1736),  M.P. 
for  Southwark,  1713-1722  ;  created  baronet,  1715. 


EARLY  YEARS  OF  THE  COMPANY  23 


4  You  are  all  sensible  of  the  insupportable  weight  of  the 
national  debts  which  the  public  became  engaged  for 
from  the  necessity  of  the  times,  the  pressure  of  a  long 
and  expensive  war,  and  the  languishing  state  of  public 
credit,’  so  ran  the  passage  ;  4  but  the  scene  being  now  so 
happily  changed,  if  no  new  disturbances  shall  plunge 
us  again  into  straits  and  difficulties,  the  general  expec¬ 
tation  seems  to  require  of  you,  that  you  should  turn 
your  thoughts  towards  some  method  of  extricating 
yourselves,  by  reducing,  by  degrees,  the  debts  of  the 
nation.’  Ministers  then  invited  proposals  from  the 
Bank  of  England  and  the  South  Sea  Company,  and  these 
great  financial  corporations  made  offers  which  were  laid 
by  Stanhope1  before  the  House  of  Commons  on  May  20. 

The  South  Sea  Company,  which  by  an  Act  of  1715 
had  increased  its  capital  to  £10,000,000,  now  proposed 
that  it  should,  by  subscription  or  otherwise,  raise  a 
further  £2,000,000  which  should  be  paid  into  the  Ex¬ 
chequer  and  employed  towards  redeeming  the  principal 
and  interest  on  the  four  Lottery  Acts  of  1711-1712  and 
the  annuities  of  three  per  cent,  payable  for  the  bankers’ 
debt  contracted  in  the  reign  of  Charles  II.  In  return, 
the  Company  expressed  itself  not  only  willing  to  accept 
interest  on  this  additional  loan  at  the  rate  of  five  per  cent, 
per  annum,  but  also  to  accept  five  instead  of  six  per 
cent,  on  the  £10,000,000  already  advanced. 

Upon  this  proposal,  and  that  of  the  Bank,  arose  a 
lively  debate  in  the  House  of  Commons.  John  Hunger- 
ford,2  who  had  great  experience  of  finance,  did  not 

1  James  Stanhope  (1673-1721),  Secretary  of  State,  1714  ; 
First  Lord  of  the  Treasury  and  Chancellor  of  the  Exchequer, 
April,  1717-March,  1718  ;  created  Viscount,  1717,  and  Earl 
Stanhope,  1718  ;  again  Secretary  of  State,  1718  until  his  death. 

2  John  Hungerford  (d.  1729),  barrister,  standing  counsel  for 
the  East  India  Company,  M.P.  for  Scarborough. 


24 


THE  SOUTH  SEA  BUBBLE 


favour  either  scheme.  4 1  am  of  opinion,’  he  stated 
in  a  vigorous  speech,  4  that  Parliamentary  faith  ought 
to  be  preserved  untouched  and  inviolate,  since,  by 
keeping  up  its  national  credit,  England  is  glutted  with 
money  and  has  become  the  general  bank  of  Europe, 
while  most  other  countries  are  reduced  to  great  straits 
and  are  in  need  of  specie.  In  particular,  France  has 
lost  her  credit,  or,  rather,  never  had  any  ;  and  if  there 
is  any  money  in  that  kingdom,  it  is  in  the  hands  of  the 
Regent — for  what  purpose  I  cannot  say.  But  though 
Parliamentary  faith  must  remain  inviolate,  I  do  not 
doubt  but  the  wisdom  of  the  representatives  of  the 
nation  can  find  legal  ways  to  reduce  the  interest  of 
public  securities,  since  Parliamentary  faith  consists  only 
in  the  securing  the  payment  of  the  capital  sums  ad¬ 
vanced  by  private  persons  for  the  use  of  the  public.  I 
do  not  understand  why  the  public  should  pay  a  higher 
rate  than  a  private  man  ;  and  I  know  by  experience, 
and  in  the  course  of  my  business,  that  money  can  be 
had  at  four  per  cent,  on  good  securities,  for  there  is  a 
member  of  this  House  who  has  lent  me  £20,000  at  that 
rate.  It  is,  therefore,  to  be  hoped  that  the  Committee, 
duly  weighing  all  this,  will  offer  to  the  House  more 
reasonable  proposals.’  Hungerford,  wdio,  undoubtedly, 
voiced  the  sentiments  of  a  not  inconsiderable  section 
of  the  House,  was  supported  by  Aislabie,1  who  protested 
that,  4  of  late  years  the  companies  of  monied  men  are 
grown  so  uppish  as  not  only  to  tread  familiarly  with 
Parliament,  but  even  to  pretend  to  dictate  to  it,  and 
that,  therefore,  it  is  high  time  to  give  them  a  check, 
and  let  them  know  that  the  landed  men  and  their 
representatives  are  the  mainspring  and  stock  of  the 

1  John  Aislabie  (1670-1742),  Treasurer  of  the  Navy  from 
1714 ;  Chancellor  of  the  Exchequer,  March,  1718, 


EARLY  YEARS  OF  THE  COMPANY  25 


wealth  and  strength  of  the  Kingdom.’  Aislabie  moved 
that  the  business  be  postponed  until  the  next  session, 
but  upon  Stanhope  urging  that  delay  was  undesirable,  he 
withdrew  his  motion. 

The  debate  was  memorable  for  a  passage  of  arms 
between  Stanhope  and  Walpole,1  after  the  latter  had 
declared  that  the  opposition  was  mainly  influenced  by 
the  thought  that  he  personally  would  derive  some 
advantage  from  it,  but  this  belief  he  stated  had  no 
foundation  in  fact.  He  remarked,  in  the  course  of  his 
speech,  that  he  had  been  happier  as  Secretary  of  State 
for  the  Southern  Department,  since  financial  matters 
were  not  of  the  greatest  interest  to  him ;  but,  he  added 
meaningly,  while  he  was  at  the  head  of  the  Treasury 
he  would  make  up  for  any  shortcomings  by  honesty  and 
disinterestedness,  and  would  content  himself  with  the 
salary  and  lawful  perquisite  of  his  office,  and,  he  con¬ 
cluded,  ‘  though  I  have  quitted  a  better  place,  I  will 
not  quarter  myself  upon  anybody  to  make  it  up.  I 
have  no  brothers,  nor  other  relations,  to  provide  for, 
and,  upon  first  entering  into  the  Treasury,  I  made  a 
standing  order  against  the  late  practice  of  granting 
reversions  of  places.’  This  was  regarded,  and  rightly 
regarded,  as  an  attack  on  Walpole,  who  replied  so 
bitterly  that  it  was  generally  thought  that  the  matter 
would  not  be  allowed  by  him  to  rest  there.  Conse¬ 
quently,  when  the  Speaker  2  returned  to  the  Chair, 

1  Robert  Walpole  (1676-1745)  entered  Parliament  1701, 
and  soon  became  one  of  the  leaders  of  the  Whig  party  ;  Secre- 
tary-at-War,  1708-1710  ;  Treasurer  of  the  Navy,  1710-1711  ; 
First  Lord  of  the  Treasury  and  Chancellor  of  the  Exchequer, 
October,  1715-April,  1717. 

2  The  Hon.  Spencer  Compton  (1673  ?-1743),  M.P.  for  Sussex, 
Speaker  of  the  House  of  Commons,  1715-1727  ;  created  Baron 
Wilmington,  1728,  and  Earl  of  Wilmington,  1730. 


26 


THE  SOUTH  SEA  BUBBLE 


Hugh  Boscawen  1  rose  and  remarked  that,  4  It  was 
melancholy  to  see  that  any  difference  should  happen 
between  these  members,  unbecoming  their  own  char¬ 
acter  and  the  dignity  of  that  assembly,  but  that  it 
would  be  a  still  greater  misfortune  if  they  should  go  out 
with  any  resentment,’  and  he  moved,  and  carried,  a 
Resolution,  4  That  the  House  lay  its  commands  upon 
them  that  no  further  notice  be  taken  of  what  had 
passed.’  As  showing  the  spirit  of  the  age,  it  is  worthy 
of  note  that  Walpole  frankly  admitted  that  while  in 
office  he  had  sought  to  serve  his  relations  and  friends, 
than  which,  he  declared,  nothing  was  4  more  reasonable 
or  more  just.’ 

It  was  not  until  1717  that  the  Company’s  first  annual 
ship,  christened  the  Royal  Prince ,  as  a  compliment  to 
the  heir  to  the  throne,  set  sail  for  Vera  Cruz.  At  the 
beginning  of  the  next  year  the  Prince  of  Wales,  who 
had  been  the  Governor  of  the  Company  for  three  years, 
retired,  and  on  February  1  an  Address  was  presented 
to  the  King,  praying  him  to  allow  himself  to  be  nomi¬ 
nated  in  the  stead  of  his  son.  A  deputation  of  Directors 
carried  the  address  to  St.  James’s  Palace,  and  His 
Majesty  conferred  a  knighthood  upon  one  of  the  number, 
George  Caswell.  On  the  same  day  a  Royal  message 
was  sent  to  the  House  of  Commons  :  4  His  Majesty 
having  received  a  very  dutiful  address  from  the  South 
Sea  Company,  that  he  would  be  graciously  pleased  to 
permit  himself  to  be  elected  Governor  of  the  said  Com¬ 
pany,  and  His  Majesty  being  willing  to  condescend 
thereto,  recommends  it  to  this  House,  to  consider  of 
proper  methods  to  remove  any  difficulties  that  may  arise 

1  Hugh  Boscawen  (d.  1734),  Comptroller  of  the  Household, 
1714-1720;  Joint  Vice-Treasurer  of  Oxford,  1717-1734  ;  created 
Viscount  Falmouth,  1720, 


p.  26 


George  I 


EARLY  YEARS  OF  THE  COMPANY  27 


on  that  occasion.’  A  Bill  to  enable  the  King  to  be 
Governor  of  the  South  Sea  Company  was  passed  by 
both  Houses  of  Parliament,  and  on  February  2  received 
the  Royal  Assent.  This  event  was  much  commented 
on,  both  then  and  later.  4  You  remember,  and  so  do  I, 
when  the  South  Sea  was  said  to  be  my  Lord  Oxford’s 
brat,  and  must  be  starved  at  nurse,’  the  Duchess  of 
Ormonde  1  subsequently  (April  18,  1720)  wrote  to 
Swift.  4  Now  the  King  has  adopted  it,  calls  it  his 
beloved  child  ;  though  perhaps  you  may  say  if  he  loves 
it  no  better  than  his  son  it  will  not  say  much  :  but 
he  loves  it  as  well  as  the  Duchess  of  Kfendal],2  and 
that  is  saying  a  good  deal.  I  wish  it  may  thrive,  for 
many  of  my  friends  are  deep  in  it  :  I  wish  you  were 
so  too.’  When  the  King  became  Governor  of  the  Com¬ 
pany,  Sir  John  Fellowes,  bart.,  and  Charles  Joye  became, 
respectively,  Sub-Governor  and  Deputy- Governor, 
Astell,  Blackwell,  Sir  John  Blunt,  Chester,  Delaporte, 
Francis  Eyles,  Gibbon,  Gore,  Hammond,  Hawes,  Horsey, 
Houlditch,  Janssen,  Jacobsen,  Master,  Page,  Raymond, 
Read,  Reynolds,  and  Sawbridge  were  re-elected  as 
Directors  ;  and  the  vacancies  were  filled  by  Sir  Robert 
Chaplin,3  Stephen  Child,  James  Edmondson,4  Arthur 
Ingram,5  William  Tillard,  and  John  Turner. 

1  Mary,  the  eldest  daughter  of  the  first  Duke  of  Beaufort, 
who  had  married  James  Butler,  second  Duke  of  Ormonde. 

2  Countess  Ehrengard  Melusina  von  der  Schulenburg  (1667- 
1743),  the  mistress  of  George  I.,  was  in  1716  created  Duchess  of 
Munster  in  the  Irish  peerage,  and,  three  years  later,  Duchess  of 
Kendal  in  the  English  peerage. 

3  Sir  Robert  Chaplin,  bart.  (d.  1728),  London  merchant 
M.P.  for  Great  Grimsby  from  1715  until  expelled  from  the 
House  of  Commons  in  1720  ;  created  baronet,  September,  1715. 

4  James  Edmondson,  Purser  of  H.M.S.  Anne. 

5  Arthur  Ingram,  M.P.  for  Horsham,  Treasurer  of  the  duties 
on  Salt. 


28 


THE  SOUTH  SEA  BUBBLE 


A  second  annual  ship  was  launched  in  March,  1718, 
and  named  the  Royal  George ,  in  honour  of  the  new 
Governor  ;  but  this  vessel  did  not  sail,  because,  before 
it  weighed  anchor,  there  was  trouble  between  England 
and  Spain.  ‘  I  am  told  Cardinal  Alberoni  told  Stanhope 
in  case  the  English  helped  the  Emperor,  the  King  of 
Spain  would  order  all  the  South  Sea  effects  to  be  seized,’ 1 
Sir  Peter  Redmond  wrote  to  the  Duke  of  Mar  from 
Rome  on  February  12.  This  proved  only  too  true,  and 
the  Company’s  goods  and  officials  in  the  Spanish  West 
Indies  were  seized,  in  spite  of  the  clause  in  the  assiento 
contract,  which  allowed  that,  in  case  of  war  breaking 
out,  the  Company  should  be  allowed  eighteen  months 
in  which  to  remove  their  effects.  The  Company,  how¬ 
ever,  had  never  been  given  fair  play  by  Spain,  and, 
after  this  last  outrage,  it  presented  to  the  British  Govern¬ 
ment  a  summary  of  its  grievances,  which,  it  must  be 
confessed,  were  legitimate,  and  showed  the  difficulties 
under  which  the  corporation  had  laboured.  The  memo¬ 
rial  complained  of  the  ill-treatment  of  the  Bedford  and 
Elizabeth ,  and  it  stated  that  the  King  of  Spain  by  sus¬ 
pending  the  Royal  George  from  sailing,  after  having 
on  board  a  cargo  of  the  value  of  £300,000,  which  was 
thereby  much  damaged,  was  a  very  great  loss.  It  then 
enumerated  the  loss  which  was  suffered  by  laying  exor¬ 
bitant  duties  on  the  Company’s  ship  permitted  to  load 
fruit  at  the  Canaries  for  the  Spanish  West  Indies  ;  by 
laying  duties  on  the  purchasers  of  the  Company’s 
negroes  ;  by  conniving  at,  and  permitting,  many  negroes 
to  be  imported  clandestinely  by  others,  contrary  to 
the  assiento  contract ;  by  obstructing  the  Company’s 
officers  from  loading  homeward,  either  tobacco  or 
cocoa,  likewise  contrary  to  the  assiento ;  by  false 

1  Stuart  MSS.,  V.,  4G2. 


EARLY  YEARS  OF  THE  COMPANY  29 


measuring  of  the  Company’s  negroes,  and  denying 
justice  therein  ;  in  delaying  justice  in  law- suits  against 
the  Spanish  officers,  for  extorting  exorbitant  fees  for 
the  negroes  imported  by  the  Company  ;  by  obliging 
the  Company’s  factors  at  Panama  to  pay  the  duties  on 
slaves  confiscated  and  insulted,  contrary  to  the  usage 
of  former  assientists  ;  for  compelling  the  Company’s 
factors  at  Panama  and  Havana  to  pay  a  duty  of  six 
pieces  of  eight  for  the  burial  of  each  negro  ;  in  denying 
the  Company’s  factors  at  Buenos  Aires  the  lands 
stipulated  by  the  assiento  contract  to  be  assigned  them 
for  raising  cattle,  provisions,  etc.,  etc.,  for  their  negroes  ; 
by  extorting  extravagant  port  charges  there,  for  the 
Company’s  ships,  and  obstructing  their  purchasing  goods 
there  ;  with  other  abuses  at  that  port  and  at  Panama  ; 
and  by  the  Spanish  guarda-cosia  ships  stopping  the 
Company’s  assiento  ships,  and  taking  from  them  sundry 
things  not  contraband.  The  Company  claimed  that 
by  the  seizing  of  their  effects  it  had  lost  £200,000,  and 
it  demanded  redress.  Representations  to  Spain  pro¬ 
duced  an  assurance  that  when  peace  was  made,  it  would 
be  indemnified,  but,  as  a  matter  of  fact,  the  Company 
was  never  fully  reimbursed. 


CHAPTER  II 


The  South  Sea  Company  Takes  Over  the 

National  Debt 


JANUARY-MARCH,  1720 

HINGS  were  now  to  move  very  quickly  with  the 


JL  South  Sea  Company,  and  during  the  year  1720 
it  is  not  too  much  to  say  that  it  almost  monopolised 
the  attention  and  interest,  as  it  affected  the  fortunes, 
of  all  classes  in  the  country. 

The  Company,  seeing  little  opportunity  to  increase 
its  trade  with  South  America,  thought  to  increase  its 
receipts  and  to  enhance  its  importance  by  enlarging 
its  financial  operations.  Early  in  1719  it  saw  its  oppor¬ 
tunity,  and  with  great  promptitude  seized  it.  The 
Government  was  anxious  to  discharge  the  irredeemable 
debt,  if  this  could  be  done  on  reasonable  terms,  and  it 
proposed  to  make  a  beginning  with  the  tickets  of  the 
Lottery  of  1710,  which  were  irredeemable  annuities 
for  thirty-two  years  from  that  date.  Nothing  could 
be  more  easy,  said  the  South  Sea  Directors  ;  pass  an 
Act  of  Parliament  converting  these  into  redeemable 
principal  sums  at  five  per  cent,  interest,  and  the  pro¬ 
prietors  of  the  tickets  of  the  Lottery  can,  by  a  voluntary 
subscription,  be  taken  into  the  capital  stock  of  the 
Company.  The  scheme  was  certainly  feasible,  and  the 
terms  were  favourable  to  the  public.  As  matters  stood, 


30 


THE  COMPANY’S  OPERATIONS  31 

the  nation  was  engaged  to  pay  £135,000  per  annum 
until  Christmas,  1742,  and  also  arrears  for  a  year  and 
a  quarter.  The  Company  asked  for  powers  to  increase 
their  capital  by  £2,500,000.  Of  this  amount  they 
would  devote  £1,721,250  to  taking  in  the  annuities  into 
their  stock  at  twelve  and  three-quarter  years’  purchase 
(including  the  arrears),  and  would  lend  the  Government 
the  balance  of  £778,750.  In  return,  they  would  receive 
interest  on  £2,500,000  at  the  rate  of  five  per  cent.,  that 
is,  £125,000  per  annum,  and  for  charges  of  manage¬ 
ment  £2,000  a  year  ;  the  country  saving  £8,000  per 
annum.  The  proposal  was  accepted,  and  in  July  the 
Company  opened  their  books  for  the  subscription  of 
the  annuities.1 

The  success  which  rewarded  their  efforts  in  this  case 
impelled  them  to  essay  greater  achievements,  and  in 
the  autumn  of  the  same  year  certain  of  the  Directors 
became  consumed  with  the  ambition  of  making  this 
Company  the  greatest  financial  concern  ever  imagined. 
This  they  proposed  ingenuously  to  effect  by  incorpor¬ 
ating  the  funds  of  the  Bank  of  England,  the  East  India 
Company,  and  the  Exchequer  with  the  capital  of  the 
South  Sea  Company.  The  audacity  of  the  scheme  was 
magnificent ;  but  Sir  John  Blunt,  who  is  said  to  have 
been  the  prime  mover  in  the  matter,  cannot  lay  claim 
to  praise  for  originality,  since  he  merely  proposed  to 

1  The  proprietors  only  subscribed  annuities  to  the  amount 
of  £94,329  12s.,  which,  at  twelve  and  three-quarter  years’ 
purchase,  made  in  capital  stock  £1,202,702  8s.  As  the  Com¬ 
pany  issued  the  stock  at  £114  per  cent.,  it  made  a  handsome 
profit.  The  Company,  therefore,  had  only  in  that  proportion 
to  advance  to  the  Government  £544,142  0s.  10d.,  so  that  their 
capital  was  increased  only  by  £1,746,844  8s.  10 d.,  and  they 
received  for  charges  of  management  only  £1,397  9s.  6 d.  per 
annum. 


32 


THE  SOUTH  SEA  BUBBLE 


introduce  here,  with  variations,  a  project  which  had 
already  been  put  into  practice  in  France  by  John  Law. 

John  Law,  who  was  born  in  1671,  was  the  son  of  a 
well-to-do  Edinburgh  goldsmith.  He  went  at  an  early 
age  to  London,  where  he  plunged  into  dissipation,  but 
his  career  in  the  metropolis  was  brought  to  an  abrupt 
conclusion  in  April,  1694,  when  he  killed  4  Beau  5  Wilson  1 
in  a  duel.  He  was  convicted  of  murder,  and  sentenced 
to  death,  but  contrived  to  escape  abroad.  At  Amster¬ 
dam  he  studied  finance,  and  when  he  returned  to  Scot¬ 
land  he  published  pamphlets  on  the  subject,  which 
brought  him  into  considerable  repute.  Nine  years  later 
he  suggested  a  State  Bank  for  Scotland,  but,  although 
he  had  by  this  time  gathered  around  him  influential 
supporters,  the  scheme  did  not  materialise.  He  soon 
went  abroad  again,  and  becoming  a  professional  (but, 
there  is  no  reason  to  doubt,  an  entirely  honest)  gambler, 
he  had  by  1715  amassed  a  fortune,  estimated  to  have 
exceeded  £100,000.  During  this  period  he  had  more  than 
once  made  proposals,  the  object  of  which  was  to  restore 
the  public  credit  in  France,  which  was  at  a  very  low  ebb. 
Louis  XIV.,  however,  would  have  none  of  him  ;  but 
the  Duke  of  Orleans  was  favourably  impressed  by  his 
gift  for  dealing  with  financial  problems,  and  so  were 
others,  including  Victor  Amadeus,  King  of  Sicily,  after¬ 
wards  King  of  Sardinia,  who  invited  him  to  manage  his 
exchequer,  and  Lord  Stair,2  the  English  ambassador,  who 
wrote  to  Lord  Stanhope  that  Law  might  be  usefully 

1  Edward  Wilson  (d.  1G94),  better  known  as  ‘  Beau  ’  Wilson, 
a  scion  of  an  old  Leicestershire  family,  a  noted  dandy,  who  lived 
in  luxury,  apparently  on  nothing  a  year.  Much  curiosity  was 
evinced,  and  many  speculations  were  rife,  as  to  the  source  from 
which  lie  derived  his  income. 

2  John  Dalrymple,  second  Earl  of  Stair  (1673-1747),  Ambas¬ 
sador  at  Paris,  1715-1720. 


/>.  32 


John  Law 
Conseiller  du  Roy 


THE  COMPANY’S  OPERATIONS 


38 


employed  in  devising  a  scheme  for  reducing  the  English 
National  Debt.  In  May  of  1716,  the  year  after  the 
death  of  Louis  XIV.,  Law,  with  the  sanction  and 
approval  of  the  Duke  of  Orleans,  now  Regent  of  France, 
opened  in  Paris  the  Banque  Generale.  The  success 
of  this  institution  aroused  the  jealousy  of  the  French 
bankers,  who,  not  unnaturally,  objected  to  such  a  privi¬ 
lege  being  conceded  to  a  foreigner.  To  still  this  outcry, 
the  Banque  Generale  was  in  December,  1718,  converted 
into  the  Banque  Royale,  with  its  notes  guaranteed  by 
the  Crown,  and  with  Law  as  its  Director-General.  Law 
was  now  able  to  develop  a  long-eherished  scheme.  In 
August,  1714,  he  had  inaugurated  the  Mississippi  Com¬ 
pany,  for  the  purpose  of  colonising  the  province  of 
Louisiana,  which  at  that  time  included  the  territories 
drained  by  the  Mississippi,  the  Ohio,  and  the  Missouri, 
granted  by  the  Regent ;  and  in  August,  1719,  this  Cor¬ 
poration,  which  had  bought  up  the  French  East  India, 
China,  and  African  Companies,  undertook  to  pay  off 
the  French  public  debts  by  giving  the  proprietors 
Mississippi  stock. 

In  spite  of  the  fact  that  the  South  Sea  Company  had 
been  unable  to  carry  out  on  an  extensive  scale  its  pro¬ 
jected  trade  with  Spanish  America,  it  had,  by  the 
profits  of  its  financial  business,  come  to  be  regarded, 
and  not  without  some  reason,  as  in  fairly  flourishing 
condition.  Its  stock,  which  in  the  autumn  of  1711  had 
been  quoted  at  76,  had  risen  by  the  end  of  1713  to  94 J, 
though  at  the  beginning  of  the  following  year  the 
declining  health  of  Queen  Anne  and  the  uncertainty  as 
to  what  would  happen  after  her  death  sent  the  stock 
down  to  85.  The  fall,  however,  was  not  peculiar  to  this 
security,  for  the  market  generally  was  affected  by  the 
unsettled  state  of  affairs,  and  Bank  stock  at  this  time 


D 


34 


THE  SOUTH  SEA  BUBBLE 


declined  from  126  to  116.  After  the  defeat  of  the 
rebellion  of  ’15,  South  Sea  stock  was  quoted  at  prices 
varying  from  par  to  106,  at  which  quotation  it  was  a 
sound  investment.  When  now,  in  the  autumn  of  1719, 
the  Government  declined  to  entertain  Blunt’s  ambi¬ 
tious  project,  a  rumour  spread  that  the  Company  was 
about  to  launch  some  great  project,  and  an  eager 
demand  for  stock  sent  the  price  up  steadily,  until  at 
Christmas  it  stood  at  126. 

Blunt,  unperturbed  by  the  reception  accorded  to  one 
proposal,  came  forward  at  once  with  another,  even  more 
audacious.  This  was  nothing  less  than  to  relieve  the 
country  of  the  National  Debt  by  reducing  all  the  funds 
into  one  under  the  control  of  the  South  Sea  Company. 
The  scheme  was  so  magnificent,  so  far-reaching,  that  it 
is  no  wonder  that  it  attracted  attention  outside  finan¬ 
cial  circles.  4  If  any  of  the  days  of  us  or  our  forefathers 
might  be  called  the  'projecting  age,  I  think  this  is  the 
time,’  a  contemporary  wrote.  4  If  ever  there  was  a 
nation  that  had  been  twenty-three  years  ruining  itself 
and  recovered  in  a  moment,  this  is  the  time.  If  ever 
a  Government  paid  its  debts  without  money,  and  ex¬ 
changed  all  the  cash  in  the  kingdom  for  bits  of  paper, 
which  had  neither  anybody  to  pay  them  for,  or  any 
intrinsic  fund,  to  pay  themselves,  this  is  the  time.  If 
ever  a  credit  was  raised  without  a  foundation,  and  built 
up  to  a  height  that  not  only  was  likely  to  fall,  but 
indeed  was  impossible  to  stand,  this  is  the  time.’ 1 

Blunt’s  second  suggestion  would  probably  have  gone 
the  way  of  the  other,  but  for  the  fact  that  its  projector, 
profiting  by  his  previous  experience,  had  learnt  to 
walk  more  warily.  This  time  he  went  direct  to  Aislabie, 
now  Chancellor  of  the  Exchequer  in  succession  to  Benson, 

1  Original  Journal,  December  17,  1710. 


THE  COMPANY’S  OPERATIONS 


35 


who  had  been  4  kicked  upstairs  ’  as  Baron  Bingley. 
Blunt  was  clever  enough  to  realise  that  the  Minister 
was  avaricious,  and  unscrupulous  enough  to  endeavour 
to  take  advantage  of  the  weakness.  At  first  he  hinted, 
and  then  stated  outright,  that,  without  any  possibility 
of  loss,  and  without  putting  down  a  single  penny,  vast 
wealth  could  in  all  probability  be  acquired  by  those 
primarily  concerned  with  the  promotion  of  the  necessary 
legislation.  Aislabie  was  won,  at  what  cost  will  presently 
transpire.  A  similar  course  was  then  pursued  with 
James  Craggs  the  elder,  who,  although  he  held  only  the 
minor  office  of  Joint  Postmaster- General,  yet  was 
regarded  by  the  Government  as  an  authority  on  finance. 
Other  powerful  interests  were  conciliated  and,  the  ground 
being  carefully  prepared,  the  campaign  opened. 

As  the  result  of  these  preliminary  steps,  it  was  arranged 
that  the  matter  should  forthwith  be  dealt  with, 
and,  as  a  first  step,  in  the  speech  with  which  the  King 
opened  Parliament  on  November  23,  the  words,  addressed 
to  his  faithful  Commons,  were  inserted,  4 1  must  desire 
you  to  turn  your  thoughts  to  the  proper  means  for 
lessening  the  debts  of  the  nation  ’  :  to  this  was  made 
the  dutiful  reply,  4  We  assure  Your  Majesty  that  we 
will  apply  ourselves  to  find  out  the  best  means  for 
lessening  the  debts  of  the  nation  and  supporting  the 
public  credit.’  On  the  following  January  22,  Aislabie 
presented  to  the  House  of  Commons  a  proposal  from 
the  Company.  4  The  Corporation  of  the  Governor  and 
Company  of  Merchants  of  Great  Britain,  trading  to 
the  South  Seas  and  other  parts  of  America,  and  for 
encouraging  the  fishery,’  so  ran  the  preamble,  4  having 
under  their  consideration  how  they  may  be  most  ser¬ 
viceable  to  His  Majesty  and  his  Government,  and  to 
show  their  zeal  and  readiness  to  concur  in  the  great 


36 


THE  SOUTH  SEA  BUBBLE 


and  honourable  design  of  reducing  the  national  debts, 
in  such  manner  as  may  be  consistent  with,  and  for  the 
support  of  parliamentary  credit,  do  humbly  apprehend, 
that  if  the  public  debts  and  annuities  were  taken  into, 
and  made  part  of,  the  capital  stock  of  the  said  Company, 
it  would  greatly  contribute  to  that  desirable  end.’ 
Then  followed  an  estimate  of  the  debts  and  annuities  : — 

Annuities  for  term,  of  years. 

Annuities  granted  for  99  years  or  96  years,  £  s.  d . 

amounting  to  £667,705  8s.  Id.  per 
annum,' which,  at  20  years’  purchase, 
amount  to  .  .  .  .  13,354,108  1  8 

Lottery  1710,  remaining  unsubscribed  to 
the  Company,  about  £40,670  85.  per 
annum,  which,  at  14  years’  purchase, 
amounts  to  .  .  .  .  569,385  12  0 

Annuities  of  £9  per  cent.,  amounting  to 
£81,000  per  annum,  at  14  years’  pur¬ 
chase,  amount  to  .  .  .  .  1,134,000  0  0 

15,057,493  13  8 

Debts  redeemable  by  Parliament. 

Total  after  the  rate  of  £5  per  cent,  per 

annum . £11,795,466  5  6J 

Total  after  the  rate  of  £4  per  cent,  per 

annum .  4,128,752  7  4 

£15,924,218  12  10£ 

It  had  all  along  been  perfectly  clear  to  Blunt  that 
Parliament  would  not  accept  the  scheme  merely  for  the 
love  of  the  Company,  and  that,  therefore,  it  behoved 
the  Directors  to  make  the  scheme  palatable  to  the 
nation.  Into  the  minor  details  of  the  proposal  it  is 
not  necessary  to  enter  :  the  main  feature  was  that, 
for  the  liberty  to  increase  their  capital  stock  by  this 
vast  amount,  the  Company  would  pay  into  the  Ex¬ 
chequer  the  sum  of  #3, 500, 000.  Upon  this,  Aislabie, 


THE  COMPANY’S  OPERATIONS 


37 


when-  he  spoke  in  favour  of  the  proposal,  naturally 
dwelt  with  emphasis.  When  he  sat  down,  James 
Craggs  the  younger,  Secretary  of  State  for  the  Southern 
Department,  rose,  and  congratulated  the  nation  upon 
the  prospect  it  had  of  getting  out  of  debt  so  much 
sooner  than  had  been  generally  expected.  He  spoke 
at  some  length,  and,  in  conclusion,  said,  so  a  report 
has  it,  4  that  no  other  regular  motion  could  be  made, 
than  that  the  Chairman  [of  the  Committee  of  Ways  and 
Means]  should  report  our  having  made  some  progress, 
and  desiring  leave  to  sit  again  ;  for  that  he  took  for 
granted  every  gentleman’s  being  ready  and  willing  to 
receive  a  proposal  from  the  South  Sea  Company,  upon 
the  foot  of  what  had  been  so  well  opened.’  It  seemed 
as  if  the  House  would  accept  this,  for  no  one  seemed 
eager  to  continue  the  debate,  but  just  as  Craggs  was 
about  to  make  his  motion  in  form,  Arthur  Brodrick  1 
intervened.  4 1  readily  agreed  with  the  two  gentlemen 
who  had  spoken,’  he  described  his  speech  in  a  letter  to 
his  brother,  Viscount  Middleton,  4  that  till  the  national 
debt  was  discharged,  or  at  least  in  a  fair  way  of  being 
so,  we  were  not  to  expect  making  that  figure  we  formerly 
had.  I  said  I  could  go  further,  making  use  of  the 
expression  of  a  gentleman  [Archibald  Hutcheson] 2  who 
told  us  in  a  former  Session  that,  till  this  was  done,  we 
could  not  properly  speaking  call  ourselves  a  nation  ; 
that  therefore  every  scheme  or  proposal  tending  thereto 
ought  to  be  received  and  considered.  But  that  the 
occasion  of  my  now  speaking  was,  that  the  first  gentle¬ 
man  who  spoke  seemed  to  me  to  recommend  the  scheme 

1  Arthur  Brodrick,  M.P.  for  Stockbridge,  brother  of  Alan 
Brodrick,  Viscount  Middleton  (1660  ?-1728),  Lord  Chancellor 
of  Ireland,  1714-1725. 

2  Archibald  Hutcheson,  M.P.  for  Hastings. 


88 


THE  SOUTH  SEA  BUBBLE 


not  only  in  opposition  to,  but  even  exclusively  of  all 
others  ;  and  that  the  next  had  chimed  in  with  him  ; 
that  I  hoped,  in  order  to  make  the  best  bargain  we 
could,  every  other  company,  nay,  any  other  society  of 
men,  might  be  at  as  full  liberty  to  make  proposals  as 
the  South  Sea  Company,  since  every  gentleman  must 
agree  this  to  be  the  likeliest  way  to  make  a  good  bargain 
for  the  public.’  1 

The  effect  produced  by  Brodrick’s  speech  was  much 

greater  than  he  had  expected.  ‘  Our  great  men,’  he 

♦ 

added,  4  looked  as  if  thunderstruck,  and  one  of  them 
in  particular  turned  as  pale  as  my  cravat.’  2  The 
person  who  changed  colour  was,  no  doubt,  Aislabie,  for 
there  was  a  report  current  that  the  bargain  had  been 
made  at  Lechmere’s  3  chambers  between  him  and  Sir 
George  Caswell  and  other  South  Sea  Directors,  and 
that  after  the  conference  he  had  invested  £27,000  in 
the  Company’s  stock,  never  doubting  that  the  scheme 
would  be  accepted  and  that,  upon  the  acceptance,  the 
price  of  the  stock  would  rise.  Anyhow,  it  was  Aislabie 
who,  in  the  subsequent  course  of  the  debate,  stated 
heatedly,  4  Things  of  this  nature  must  be  carried  on 
with  a  spirit.’  To  this  Sir  Joseph  Jekyll 4  took  exception. 
4  This  spirit  is  what  has  undone  the  nation,’  he  declared. 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  182. 

2  Coxe’s  Memoirs  of  Sir  Robert  Walpole. 

3  Nicholas  Lechmere  (1675-1727),  Solicitor-General,  1714- 
1718  ;  Attorney-General,  1718  ;  appointed  for  life  in  1718 
Chancellor  of  the  Duchy  of  Lancaster.  He  resigned  the  office 
of  Attorney- General  on  May  7,  1720.  He  was  raised  to  the 
peerage  in  the  following  year.  He  had  married  Lady  Elizabeth 
Howard  (d.  1727),  daughter  of  Charles  Howard,  third  Earl  of 
Carlisle. 

4  Sir  Joseph  Jekyll  (1663-1738),  M.P.  for  Lymington  from 
1697  until  his  death  ;  Master  of  the  Rolls,  1717-1738. 


THE  COMPANY’S  OPERATIONS 


30 


4  Our  business  is  to  consider  thoroughly,  deliberate 
calmly,  and  judge  of  the  whole  upon  reason,  not  with 
the  spirit  mentioned.’  When  Aislabie  explained  lamely 
that  he  4  only  meant  that  credit  was  to  be  so  supported  ’ 
he  was  greeted  with  laughter.  Walpole,  who,  at  this 
juncture,  did  not  express  himself  as  unfavourable  to 
the  design,  asserted,  however,  that  some  details  re¬ 
quired  amendment.  Then  Lechmere,  instead  of  reply¬ 
ing  to  the  ex-Minister,  proceeded  to  attack  him  with 
reference  to  a  scheme  which  had  earlier  been  put  forward 
by  him.  Walpole,  never  a  safe  man  to  attack,  rose 
again,  and  proved  conclusively  that  Lechmere  had  dis¬ 
torted  facts,  and  emphasised  the  weaknesses  of  the 
South  Sea  proposal.  Lechmere  began  to  retort,  but  the 
House  would  not  listen,  and  when  the  Chairman  cried, 
4  Order  !  Hear  your  member  ’  there  were  cries,  4  We 
have  heard  him  long  enough.’  In  the  end  it  was 
carried  by  192  to  36  votes  that  other  proposals  should 
be  entertained.  4  Whether  the  Bank  [of  England]  will 
make  a  proposal  (as  is  generally  expected)  I  know  not,’ 
Brodrick  commented  ;  4  but  I  am  very  well  satisfied 
many  a  fair  pound  will  be  saved  to  the  public,  even  by 
the  very  proposal  the  South  Sea  Company  will  make. 
For  this  affair  is  in  a  very  different  situation  from  what 
they  expected  upon  concerting  within  doors,  and  con¬ 
sequently  a  great  many  will  fail  in  their  hopes  ;  for 
when  the  bargain  will  not  bear  it,  they  must  be  quiet.’  1 

Further  consideration  of  the  matter  was  postponed 
for  five  days,  when  the  Bank  put  forward  a  scheme,  in 
which  it  offered  £5,000,000  to  the  Exchequer.  The 
South  Sea  Company  now  applied  for  permission  to 
revise  its  proposal,  and,  this  being  permitted,  it  offered 

1  Middleton  Papers,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II. 


40 


THE  SOUTH  SEA  BUBBLE 

£7,567,000  in  case  all  the  debts  shcmld  *be  subscribed, 
and  in  that  proportion  for  any  part  of  them,  and  under¬ 
took  further  to  pay  for  the  use  of  the  public  one  year’s' 
purchase  of  all  such  of  the  long  irredeemable  annuities 
as  should  not  be  brought  into  the  capital.  This  mad 
auction  concluded  with  the  Bank’s  second  proposal  in 
which  it  expressed  its  willingness  to  give  £1,700  Bank 
stock  for  every  £100  irredeemable  long  annuity. 

The  situation  was,  perhaps,  best  summarised  by 
Brodrick  in  a  letter  to  his  brother,  dated  February  2. 

‘  Yesterday,’  he  wrote,  4  the  Committee  of  the  whole 
House  came  to  a  resolution  to  accept  the  South  Sea 
proposal,  which  is  to  be  reported  (and  will  be  agreed 
to)  this  day.  That  you  may  comprehend  how  this 
affair  has  been  managed,  I’ll  give  you  a  short  detail  of 
the  whole.  You  know  by  my  former  letters  that  Mr. 
Aislabie,  when  he  opened  the  scheme,  concluded  that 
they  would  offer  £3,000,000  to  the  public  towards  pay¬ 
ment  of  the  National  Debt,  applauded  their  candour  in 
going  the  greatest  length  the  thing  could  bear,  and 
concluded  with  the  greatest  benefit  to  the  nation.  The 
South  Sea  Company,  foreseeing  that  the  House  was 
resolved  to  hear  every  proposal  that  any  other  company 
should  make,  became  sensible  that  the  Bank  would  be 
able  to  offer  a  much  better,  and,  therefore,  in  that 
which  they  advanced  in  writing,  advanced  £500,000, 
when  at  the  same  time  the  Bank  outbid  them  full 
£2,000,000.  This  put  them  under  a  necessity  to  desire 
that  they  might  amend  their  proposal,  which  was  easily 
granted,  the  generality  of  the  House  being  for  making 
the  best  bargain  for  the  public.  Yesterday  they  gave 
a  second  proposal  in  wTiting,  by  which  they  made  the 
£3,500,000  (which  they  formerly  bid)  £4,000,000,  pay¬ 
able  by  four  quarterly  payments.  This  they  were  to 


THE  COMPANY’S  OPERATIONS 


41 


pay  in  all  events.  They  further  offered,  that  instead 
of  three  years’  purchase,  which  the  Bank  had  proposed 
to  pay,  out  of  the  long  terms  (which,  for  distinction,  we 
call  the  irredeemable  funds)  they  were  willing  to  pay 
four-and-a-half  years’  purchase,  which  (upon  supposition 
the  whole  should  be  taken  in)  does  amount  to  about 
£3,000,000  more,  and  to  show  that  they  would  truly 
endeavour  doing  so,  they  submitted  to  pay  one  year’s 
purchase  certain,  in  the  nature  of  a  nomine  penso , 
which  one  year’s  purchase  amounts  to  above  £660,000 
odd.  They  had,  by  their  first  proposal,  demanded  a 
continuance  of  the  present  interest  of  five  per  cent,  for 
seven  years,  when  the  whole  was  to  be  reduced  to  four  ; 
which,  by  this  proposal,  they  reduce  to  four  years,  the 
Bank  having  in  their  proposal  offered  the  same — the 
saving  upon  this  head  amounts  to  £300,000  yearly  ; 
and,  lastly,  they  propose  to  circulate  £2,000,000  of 
Exchequer  Bills,  for  the  term  of  four  years,  gratis — the 
saving  upon  this  head  is  £50,000.  Upon  the  whole, 
instead  of  £3,000,000,  which  they  first  offered,  they 
are  now  to  pay  above  £5,000,000  certain,  to  which  is 
to  be  added  the  contingency  of  £2,500,000  more,  upon 
their  purchasing  in  the  long  terms,  which  it  is  their 
interest  to  do,  and  consequently  they  will.  Whoever 
had  heard  how  highly  the  first  scheme  was  applauded, 
how  earnestly  recommended  for  our  acceptance,  and 
how  very  near  it  was  to  be  so,  would  stand  amazed  that 
ever  the  public  (in  any  instance)  should  be  so  fortunate 
as  to  more  than  double  the  sum  intended  for  them  ; 
but  this  has  for  once  happened.  It  is  not  vanity  in 
me  to  say  that  this  is  due  to  my  motion,  because  even 
those  who  I  am  sure  wish  me  ill  are  pleased  to  con¬ 
gratulate  me  (from  the  teeth  outward)  upon  the  very 
vast  advantage  accruing  to  the  public  thereby.  I  will 


42 


THE  SOUTH  SEA  BUBBLE 


not  say  the  first  scheme  was  formed  in  order  to  any 
particular  set  of  men  finding  their  account  in  the 
acceptance  of  it,  but  am  sure  it  is  as  plain  as  the  sun 
there  was  room  enough  in  their  doing  so.  The  cal¬ 
culators  show  that  by  the  first  scheme  the  National 
Debt  would  have  been  discharged  in  twenty-eight 
years,  and  even  this  prospect  pleased  people ;  but 

it  is  now  demonstrable  it  will  be  done  in  less  than 

\ 

eighteen.’  1 

Of  Brodrick’s  good  intentions  there  can  be  no  doubt, 
but  the  permitting  of  this  rivalry  between  the  great 
financial  corporations  was  one  of  the  causes  of  the 
trouble  that  was  to  come,  since,  in  the  desire  to  secure 
the  contract,  schemes  were  put  forward  that  could  not 
honestly  be  carried  out  without  great  loss,  which  loss, 
ultimately,  was  bound  to  fall,  and,  as  is  now  known,  did 
fall,  on  the  proprietors  of  the  annuities.  This  point 
was  seen  very  clearly  by  Walpole,  who  strenuously 
opposed  the  South  Sea  Bill,  and  supported  the  offer 
made  by  the  Bank  of  England.  4  In  vain  he  displayed 
the  fallacy  of  the  South  Sea  scheme,  and  the  great 
difference  between  that  and  the  Bank,  by  showing  that 
the  Company  was  not  limited  in  the  price  they  were  to 
put  on  the  stock  made  over  to  them  ;  whereas  the  Bank 
offered  a  specific  sum  of  £1,700  stock  for  every  £100  in 
the  long  annuities,  and  the  same  proportion  for  the  short 
annuities,’  his  biographer  has  written.  ‘  In  vain  he 
urged  that  it  countenanced  the  pernicious  practice  of 
stock- jobbing,  by  diverting  the  genius  of  the  nation 
from  trade  and  industry ;  that  it  held  out  a  dangerous 
lure  for  decoying  the  unwary  to  their  ruin  by  a  false 
prospect  of  gain,  and  to  part  with  the  gradual  profits 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II.,  184. 


THE  COMPANY’S  OPERATIONS 


48 


of  their  labour  for  imaginary  wealth.  In  vain  he 
insisted  that  if  the  proposal  of  the  South  Sea  Company 
should  be  accepted,  the  rise  of  their  stock  ought  to  be 
limited.  In  vain  he  dwelt  on  the  miseries  and  confusion 
which  then  prevailed  in  France  from  the  adoption  of 
similar  measures.  In  vain  he  argued  that  as  the  whole 
success  of  the  scheme  must  chiefly  depend  on  the  rise 
of  the  stock,  the  great  principal  of  the  project  was  an 
evil  of  the  first  magnitude ;  it  was  to  raise  artificially 
the  value  of  the  stock  by  exciting  and  keeping  up  a 
general  infatuation,  and  by  promoting  dividends  out 
of  funds  which  would  not  be  adequate  to  the  purpose. 
In  vain  he  predicted  that  if  the  establishment  succeeded, 
the  Directors  would  become  masters  of  the  Kingdom,  and 
control  the  resolutions  of  the  Legislature  ;  or  if  it  did 
not  succeed,  the  failure  would  cause  a  general  dis¬ 
content.  He  closed  his  speech  by  observing,  that  such 
would  be  the  delusive  consequences,  that  the  public 
would  conceive  it  a  dream.’ 1 

So  alarmed  was  Walpole  at  the  inevitable  consequences 
he  foresaw  that,  not  content  with  speaking  against  the 
project,  he  brought  the  pen  into  action,  and  published 
a  pamphlet  embodying  his  views,  entitled,  4  The  South 
Sea  Scheme  Considered.’  All  his  efforts  were  useless. 
He  whose  every  word  had  earlier  been  listened  to  with 
the  closest  attention  was  now  a  voice  crying  in  the  wil¬ 
derness,  and  when  he  rose  in  the  House  of  Commons  to 
speak  on  the  South  Sea  Bill  members  flocked  into  the 
lobby.  Nor  was  he  the  only  person  to  perceive  the 
danger  of  the  vast  financial  corporation  that  was  being 
called  into  being.  4  The  South  Sea  Company  and  their 
friends,’  Edward  Harley  wrote  to  Lord  Oxford,  February 
2,  4  being  resolved  to  have  the  project,  made  yesterday 
1  Coxe  :  Sir  Robert  Walpole,  I.,  180 


41 


THE  SOUTH  SEA  BUBBLE 


an  offer  to  pay  £7.000,000,  which  is  an  advance  of 
£3,500,000  above  the  first  proposal,  and  £1,500,000 
above  the  Bank.  The  Committee  last  night,  and  the 
House  to-day,  have  agreed  to  their  proposal,  and 
ordered  a  Bill  to  be  brought  in  for  the  same,  so  that 
now  your  dirty  ditch  is  filled  with  a  capital  of  about 
£40,000,000.’ 1 

The  power  which  such  a  great  financial  corporation 
might,  and  probably  would,  wield  was  remarked  upon 
by  Erasmus  Lewis,2  also  in  a  letter  to  Oxford,  February 
13.  4  As  I  doubt  not  that  you  are  well  diverted  by  the 

accounts  of  many  fantastical  events  that  pass,’  he  wrote, 
4  you  will,  however,  have  a  more  than  ordinary  pleasure 
to  hear  of  the  prosperity  of  your  own  child,  the  South 
Sea  Company,  for  since  you  suckled  and  nourished  the 
infant,  it  is  grown  prodigiously,  I  had  almost  said  to 
an  unnatural  bulk.  What  effects  this  may  have  upon 
the  State  nobody  can  penetrate  further  than  yourself, 
but  sure  the  least  discerning  eye  can  discover  that  a 
body  of  men,  with  a  stock  of  £43,000,000,  and  credit 
for  as  much  more,  acting  by  united  counsels,  must  fill 
the  House  of  Commons,  and  rule  this  little  world.’ 3 
This  point,  too,  was  made  also  by  Edward  Harley,  junior,4 

1  Portland  MSS.,  V.,  591. 

South  Sea,  present  capital  .  .  .£11,746,844  8  10 

Purchase  of  the  redeemable  debts  .  15,924,218  12  10 £ 
Purchase  of  the  irredeemable  debts.  15,057,493  13  8 


£42,728,556  15  4J 

2  Erasmus  Lewis  (1G70-1754),  at  one  time  secretary  to  the 
Earl  of  Oxford.  In  1713  he  was  returned  to  Parliament  as 
member  for  Lostwithiel.  He  was  an  intimate  friend  of  Swift, 
Pope,  Gay,  and  other  men  of  letters. 

3  Portland  MSS.,  V.,  592. 

4  Edward  Harley,  junior  (1689-1741),  succeeded  his  father  as 
second  Earl  of  Oxford,  1724. 


THE  COMPANY’S  OPERATIONS 


45 


who  told  his  aunt  Abigail  Plarley  1 :  ‘  ’Tis  said  very 
justly,  I  think,  that  the  South  Sea  will  have  the 
greatest  hand  in  choosing  the  next  Parliament,  when¬ 
ever  a  new  one  is  called.’ 2  That  there  was  much  truth 
in  these  prognostications  there  can  be  no  doubt,  but 
it  was  never  proved  because  before  the  next  dissolution 
of  Parliament  the  South  Sea  Company  was  hiding  its 
diminished  head  in  the  deepest  obscurity. 

After  the  revised  proposal  of  the  South  Sea  Company 
was  accepted  by  the  House  of  Commons,  and  leave 
was  given  to  bring  in  a  Bill,  a  pamphlet  war  sprang  up, 
and  was  conducted  by  both  sides  with  the  utmost 
virulence.  One  of  the  first  of  these  brochures  appeared 
early  in  February,  and  was  entitled,  4  A  Comparison 
between  the  Proposals  of  the  Bank  and  the  South  Sea 
Company,  wherein  is  shown  that  the  proposals  of  the  first 
are  much  more  advantageous  to  the  Public  than  those 
of  the  latter,  if  they  do  not  offer  such  terms  to  the 
Annuitants  as  they  will  accept  of.’  The  anonymous 
author’s  argument  is,  4  That  it  is  every  honest  man’s 
duty  to  give  his  utmost  assistance  to  so  desirable  a 
work  as  the  discharging  the  nation  honourably  of  the 
dreadful  burden  of  the  public  debt ;  that,  therefore, 
he  offers  such  considerations  as  to  him  appear  necessary 
to  make  the  attempt  effectual  that  it  may  not  end  in  a 
job  to  get  plumbs  for  a  few  projectors,  ruin  thousands, 
and  disappoint  the  public ;  and  that,  as  he  thinks  it 
the  highest  crime,  so  he  wishes  the  greatest  punishment 
was  inflicted  upon  any  persons  in  His  Majesty’s  Councils 
and  the  management  of  his  finances,  who  shall  presume 
to  stock- job  and  buffet  about  the  public  revenues,  and, 

1  Abigail  Harley  (1664-1726),  daughter  of  Sir  Edward  Harley, 
and  sister  of  the  first  Earl  of  Oxford. 

2  Portland  MSS.,  V.,  593. 


46 


THE  SOUTH  SEA  BUBBLE 


by  the  knowledge  of  their  own  intentions,  to  raise  or 
depress  them  at  their  pleasures  and  as  they  see  their 
advantages.’  This  author  regrets  that  the  proposal  of 
the  Bank  of  England  had  not  been  acceptable  to  Parlia¬ 
ment,  because,  in  his  opinion,  the  Bank  was  an  institu¬ 
tion  founded  on  a  more  solid  basis  and  one  that  had 
already  rendered  good  service  to  the  public.  The  Bank, 
he  contended,  had  the  advantages,  firstly,  of  a  great 
credit,  and,  secondly,  had  some  £4,000,000  of  the 
public  debt  engrafted  in  its  stock.  In  a  concluding 
paragraph  he  put  his  finger  upon  a  vital  defect  in  the 
scheme.  ‘  I  hope,’  he  wrote,  ‘  I  shall  not  deserve  the 
imputation  of  calumny  if  I  surmise  that  no  member  of 
the  South  Sea  Company  can  oppose  a  proposition  so 
reasonable  as  that  they  should  be  obliged  to  declare  what 
conditions  they  will  give  their  annuitants  ;  but  such 
who  design  not  the  public  interest  but  their  own,  who 
intended  us  a  Mississippi  Company,  would  have  had 
vastly  greater  advantages  squandered  away  for  less 
than  half  the  sum  which  is  now  offered,  and  who  have 
been  cooking  up  a  project  for  seven  or  eight  months 
last  past,  under  the  pretence  of  paying  off  the  public 
debts,  but,  in  truth,  to  unburden  the  public,  and  enrich 
themselves,  and  who,  if  they  are  let  alone,  will  turn 
this  design  into  a  private  job,  and  when  they  have 
worked  up  their  stock  by  management  to  an  unnatural 
price,  will  draw  out,  and  leave  the  public  to  shift  for 
itself,  till  the  season  comes  round  again  for  gathering 
new  plums.’ 

Steele1  took  a  hand  in  the  controversy,  and  published 
two  pamphlets,  1  The  Crisis  of  Property  ’  and  4  A  Nation 
a  Family  :  being  the  sequel  of  The  Crisis  of  Property.’ 

1  Sir  Richard  Steele  (1672  -1729),  M.P.  for  Boroughbridge, 
the  famous  man  of  letters. 


THE  COMPANY’S  OPERATIONS 


47 


In  the  following  month  (March)  appeared  4  An  Argu¬ 
ment  to  show  the  Disadvantage  that  would  accrue  to 
the  Public  from  obliging  the  South  Sea  Company  to 
fix  what  capital  stock  they  will  give  for  the  Annuities  ’  ; 
and  this  at  once  produced  4  A  Letter  of  Thanks  from  the 
Author  of  44  Comparison  between  the  Proposals  of  the 
Bank  and  the  South  Sea  Company,  etc.,”  to  the  Author 
of  44  An  Argument.”  ’  The  author  of  4  A  Letter  ’  quotes 
the  other  writer,  4  That  as  the  annuities  are  the  most 
burdensome  part  of  the  debt  that  the  nation  labours 
under,  and  the  prospect  of  paying  off  these  being  the 
chief  inducement  of  the  Committee  to  accept  of  the  whole 
proposal,  so  those  who  undertake  are  both  liable  and 
willing  to  do  it,’  and  then  comments,  caustically,  4 1 
must  confess  that  you  have  taken  the  most  proper 
medium  to  prove  that  the  South  Sea  Company  will  do 
it,  by  endeavouring  to  show  that  it  will  be  their  interest 
to  do  so  :  otherwise,  I  suppose,  no  man  living  wrill 
expect  it  from  them.’ 

On  March  17  the  Chancellor  of  the  Exchequer  pre¬ 
sented  to  the  House  of  Commons,  4  A  Bill  for  enabling 
the  South  Sea  Company  to  increase  their  capital  stock 
and  fund,  by  redeeming  such  public  debts  and  encum¬ 
brances  as  are  therein  mentioned,  and  for  raising  money 
to  be  applied  for  lessening  several  of  the  public  debts 
and  encumbrances,  and  for  making  forth  new  Exchequer 
Bills  in  lieu  thereof,  to  be  circulated  and  exchanged 
upon  demand,  at  or  near  the  Exchequer.’  The  Bill 
was  read  a  first  and  second  time,  and  on  March  23  the 
House  went  into  Committee,  when  a  Motion  was  made, 
4  That  the  House  on  March  23  resolved  itself  into  a 
Grand  Committee  to  consider  the  South  Sea  Bill,’ 
and  on  t  hat  day  a  Motion  was  made,  4  That  for  rendering 
effectual  and  certain  to  the  public  the  undertaking  of 


48 


THE  SOUTH  SEA  BUBBLE 


the  South  Sea  Company  to  take  the  annuities  for  certain 
terms  of  years,  it  be  an  instruction  to  the  said  Committee  : 
that  they  should  have  power  to  receive  proposals  from 
the  South  Sea  Company,  whereby  it  might  be  fixed 
and  determined  what  share  or  shares  of  and  in  the 
to  be  increased  capital  stock  of  the  said  Company,  the 
proprietors  of  the  said  annuities  should  be  entitled 
to  have  and  to  enjoy,  who  should  voluntarily  subscribe 
the  same  into  the  said  stock,  or  how  many  years’  pur¬ 
chase  in  money  they  should  have  and  receive  upon 
subscribing;  at  the  choice  of  the  proprietors  ;  and  that 
the  Committee  should  have  power  to  receive  a  clause 
or  clauses  accordingly.’  This  motion  was  warmly 
debated.  Walpole,  Steele,  and  others,  contended  that, 
the  annuitants  who  lent  out  their  money  for  the 
support  of  the  Government  with  hazard  and  uncer¬ 
tainty,  having  made  a  contract  with  the  Legislature 
and  purchased  yearly  rents  for  valuable  considerations, 
ought  not  to  be  left  at  the  mercy  of  a  private  company. 
Aislabie  was  the  principal  spokesman  for  the  Bill.  He 
contended  that  4  the  obliging  of  the  South  Sea  Company 
to  fix  a  price  upon  the  annuities  might  endanger  the 
success  of  so  beneficial  an  undertaking ;  that  as  it  was 
the  interest  of  the  Company  to  take  in  the  said  annuities, 
so  no  doubt  was  to  be  made  but  that  they  would  use  all 
their  endeavours  for  that  purpose,  and  would  offer  such 
advantageous  conditions  to  the  annuitants  as  would 
encourage  them  to  come  in  voluntarily  ;  that,  therefore, 
they  ought  to  allow  the  said  Company  a  competent 
time  to  try  what  they  could  do  ;  and  if  in  a  subsequent 
session  of  Parliament  it  should  appear  that  the  con¬ 
ditions  they  had  offered  to  the  annuitants  were  not 
reasonable,  and  consequently  had  proved  ineffectual, 
the  Commons,  in  such  a  case,  might  give  what  directions 


THE  COMPANY’S  OPERATIONS 


49 


they  should  think  proper  about  that  matter.’  After 
a  long  debate  the  Motion,  to  the  great  relief  of  the 
Directors  of  the  Company,  was  negatived  by  144  to 
140  votes. 

The  Bill  was  read  for  the  third  time  on  April  2,  and 
passed  by  172  to  55  votes.  It  was  read  in  the  House 
of  Lords  a  first  time  on  April  4,  and  a  second  time  on 
the  following  day.  It  was  not  until  the  Committee 
stage  was  reached  that  there  was  any  debate  upon  it. 
Then  Lord  North  and  Grey  spoke  against  the  Bill, 
and,  following  him,  the  Duke  of  Wharton 1  argued 
that  the  project  might  prove  of  disadvantage  to  the 
nation.  4  Firstly,’  he  said,  4  as  it  gave  foreigners  an 
opportunity  to  double  and  treble  the  vast  sums  they 
had  in  our  public  funds,  which  could  not  but  tempt 
them  to  withdraw  their  capital  stock,  with  their  immense 
gains,  to  other  countries,  which  might  drain  Great 
Britain  of  a  considerable  part  of  its  gold  and  silver. 
Secondly,  that  the  artificial  rise  of  the  South  Sea  stock 
was  a  dangerous  bait  which  might  decoy  unwary  people 
to  their  ruin,  and  allure  them,  by  a  false  prospect  of 
gain,  to  part  with  what  they  had  got  by  their  labour 
and  industry,  to  purchase  imaginary  riches.  And,  in  the 
third  place,  that  the  addition  of  above  £30,000,000  new 
capital  would  give  such  a  vast  power  to  the  South  Sea 
Company  as  might  endanger  the  liberties  of  the  nation 
and,  in  time,  subvert  our  excellent  constitution,  since 
by  their  extensive  interest,  they  might  influence  most, 
if  not  all,  of  the  elections  of  the  members,  and  conse¬ 
quently  overrule  the  resolutions  of  the  House  of  Com¬ 
mons.’  Lord  Cowper 2 *  also  opposed  the  Bill,  which, 

1  Philip  Wharton,  Duke  of  Wharton  (1698-1731). 

2  William  Cowper,  first  Earl  Cowper  (d.  1723),  Lord  Chan¬ 

cellor,  1707-1710,  1714-1718. 


50 


THE  SOUTH  SEA  BUBBLE 


he  declared,  ‘  like  the  Trojan  horse  was  ushered  in, 
and  received  with  great  pomp  and  acclamation,  but 
which  was  contrived  for  treachery  and  destruction.’ 

‘  In  all  public  bargains,’  he  continued,  4  it  is  a  duty 
incumbent  on  them  who  are  entrusted  with  the  Admini¬ 
stration  to  take  care  that  the  same  shall  be  more  advan¬ 
tageous  to  the  State  than  to  private  persons  ;  but  a 
quite  contrary  method  seems  to  have  been  followed 

V- 

in  the  contract  made  with  the  South  Sea  Company, 
for  if  the  stocks  are  kept  up  to  the  advanced  price  to 
which  they  have  been  raised  by  the  arts  of  stock- jobbing, 
either  that  Company  or  its  principal  members  will 
gain  above  £30,000,000  sterling,  of  which  they  give  but 
one-fourth  towards  the  discharge  of  the  national  debts. 
Though  this  scheme  carries  the  face  of  public  good,  yet 
nothing  can  be  so  that  is  founded  on  injustice,  as  I 
take  this  Bill  to  be.  I  apprehend,  in  particular,  that 
the  main  public  intention  of  it,  namely,  the  repurchase 
of  annuities,  will  meet  with  insuperable  difficulties  ; 
and  that,  in  such  a  case,  none  but  a  few  persons,  who 
were  in  the  secret  and  early  bought  stocks  at  a  low  rate 
and  afterwards  sold  them  at  a  high  price,  will,  in  the 
end,  be  gainers  by  this  project.’  To  Lord  Sunderland  1 
fell  the  task  of  defending  the  Government.  4  Those 
who  encouraged  and  countenanced  the  scheme  of  the 
South  Sea  Company,’  he  assured  the  House,  4  had 
nothing  in  their  view  but  the  easing  the  nation  of  that 
heavy  load  of  debt  it  labours  under.’  4  On  the  other 
hand,’  he  admitted,  4  the  managers  of  that  Company 
had  undoubtedly  a  prospect  of  private  gain,  either  to 
themselves  or  to  this  corporation  ;  but  when  the  scheme 

1  Charles  Spencer,  third  Earl  of  Sunderland  (1G74-1722), 
Secretary  of  State,  1700-1714  ;  Lord  Privy  Seal,  1715  ;  First 
Lord  of  the  Treasury,  March,  1718-1721. 


THE  COMPANY’S  OPERATIONS 


51 


was  accepted,  neither  the  one  nor  the  other  could  foresee 
that  the  stocks  would  rise  to  their  present  price.  If 
they  had  remained  as  they  were,  the  public  would  have 
had  a  far  greater  share  of  the  advantage  accruing  from 
the  scheme  ;  and  if  the  stocks  keep  up  to  the  price  they 
had  been  raised  to,  which  was  not  unlikely,  it  is  but 
reasonable  that  the  South  Sea  Company  should  enjoy 
the  profits  procured  to  it  by  the  wise  management  and 
industry  of  its  Directors,  which  will  enable  it  both  to 
make  large  dividends  among  its  members  and  thereby 
to  compass  the  ends  intended  by  this  scheme.’ 1  The 
Bill  was  read  a  third  time  on  April  6,  and  on  the  follow¬ 
ing  day  received  the  Royal  Assent. 

At  the  risk  of  being  accused  of  prophesying  after  the 
event,  it  must  be  said  that  it  is  impossible  to  understand 
how  any  body  of  men  of  average  intelligence  could 
conceivably  have  believed  that  either  corporation  could 
have  successfully  carried  out  their  proposals  with¬ 
out  injuring  the  proprietors  of  the  public  debts. 
Parliament  was  willing  to  accept  from  the  South  Sea 
Company  the  sum  of  £7,000,000,  and  showed  itself 
reluctant  to  hear  those  who  urged  that  the  privileges 
accorded  were  not  worth  a  tithe  of  this  amount.  The 
South  Sea  Company  was  not  a  highly  endowed  philan¬ 
thropic  society  :  it  was  a  body  of  merchants  trading 
for  profit.  How,  the  House  of  Commons  might  surely 
have  asked  itself,  was  the  profit  to  be  obtained  ;  how, 
indeed,  was  a  very  heavy  loss  to  be  avoided  ?  The 
Company  had  (i)  exclusive  advantages  of  the  trade  to 
the  South  Sea,  but,  at  best,  this  was  not  worth  £200,000 
a  year,  and  even  this  was  precarious,  being  dependent 
upon  the  continuance  of  peaceful  relations  with  Spain  ; 
(ii)  an  allowance  for  the  charge  of  management,  pro- 
1  Political  State  of  Great  Britain ,  XIX.,  420-423. 


52 


THE  SOUTH  SEA  BUBBLE 


portioned  to  the  augmentation  of  their  capital  stock ; 
(iii)  the  difference  of  receiving  five  per  cent,  for  the 
money  invested  in  purchasing  the  public  debts,  while 
the  usual  rate  of  interest  was  four  per  cent. 

These  were  the  ostensible  sources  of  profit ;  but 
there  was  another — the  possibility  of  an  increase  of 
wealth  which  would  accrue  from  a  rise  in  the  price  of 
capital  stock.  Indeed,  it  wras  upon  this  last,  and  upon 
this  only,  that  the  success  of  the  scheme  depended, 
^nly  by  creating  a  demand  for  the  stock  could  the  Com¬ 
pany  fulfil  its  engagements.  Is  it  any  wonder  that  the 
Directors  took  every  opportunity  to  promote  a  spirit 
of  speculation  ?  It  was  the  obvious  course  for  them 
to  pursue,  and,  naturally  enough,  therefore,  the  course 
they  took.  To  make  matters  worse,  the  public  at  this 
moment  happened  to  be  in  a  gambling  vein,  and  any¬ 
thing  was  good  enough  with  which  to  flog  a  willing 
horse — imaginary  advantages,  imaginary  acquisitions — 
hints  of  hidden  treasure — the  declaration  of  dividends 
which  could  never  be  earned. 


CHAPTER  III 


The  ‘  Boom  ’  in  the  Stock  of  the  South  Sea 


Company 

APRIL-JULY,  1720 


S  soon  as  it  became  known  that  the  South  Sea 


XjL  Company  was  making  proposals  to  Parliament, 
the  public  began  to  interest  itself  in  the  stock.  Much 
anxiety  was  evinced  as  to  the  particulars  of  the  scheme, 
and  every  rumour  had  its  effect  upon  the  market.  At 
this  time,  a  contemporary  writer  noted,  4  the  stock¬ 
jobbers  in  Exchange  Alley  were  in  perpetual  hurry, 
being  tossed  about  between  hopes  and  fears,  upon  the 
different  accounts  they  received  almost  every  minute 
from  their  agents  and  friends  in  Westminster.’  1  Pre¬ 
sently  every  one  seemed  convinced  that  the  deal  would 
come  off,  and,  jumping  to  the  conclusion  that  it  would 
be  a  good  thing  for  the  Corporation,  wanted  to  have  a 
finger  in  this  presumably  profitable  pie.  4  The  spirit 
of  stock- jobbing  is  rising  to  a  higher  degree  than  ever,’ 
Edward  Harley  wrote  from  London  to  Lord  Oxford, 
February  2,  1720.  4  They  that  cannot  turn  themselves 

to  do  this  will  find  very  little  to  do  here,  and  can  only 
be  speculators  of  other  men’s  cheats  and  follies.  There 
has  been  in  former  ages  something  like  our  Exchange 


1  Political  State  of  Great  Britain ,  XIX.,  336. 


54 


THE  SOUTH  SEA  BUBBLE 


Alley.  When  this  humour  became  prevalent,  some  of 
our  greatest  patriots  thought  a  retirement  to  a  country 
farm  both  a  safe  and  wise  retreat.’1 

As  soon  as  Parliament  gave  the  preference  over  the 
Bank  to  the  South  Sea  Company,  the  price  of  its  stock 
went  up  by  leaps  and  bounds.  From  126  it  rose  to 
400.  4  South  Sea  is  all  the  rage  and  fashion ;  the 

ladies  sell  their  jewels  to  buy,  and  happy  are  they  that 
are  in,’  Mrs.  Windham  wrote  to  Ashe  Windham.2  4  It 
has  fell  a  little,  some  say  till  the  Bill  is  passed,  others, 
foreigners  do  not  come  in  :  last  post  says  it  sells  in  Hol¬ 
land  for  400  .  .  .  but  the  first  dealers  were  the  greatest 
gainers.’  3  Probably  these  first  dealers  were  content 
to  take  their  profit,  and  thus  brought  down  the  price  : 
certainly  the  stock  declined  to  330,  at  which  figure  it 
remained  through  March. 

Stock- jobbing  was  now  the  principal  subject  of  con¬ 
versation.  4 1  find,’  Edward  Harley,  junior,  wrote  to 
his  aunt,  Abigail  Harley,  on  February  25,  4  that  there 
are  few  in  London  that  mind  anything  but  the  rising 
and  falling  of  the  stocks,  upon  which  all  the  news  and 
talk  of  the  town  turns,  so  that  unless  I  bring  South  Sea, 
African  Bank,  cent,  per  cent.,  par,  etc.,  and  such  stuff 
into  my  letter  I  shall  neither  be  fashionable  nor  fill  it 
up.  It  is  said,  Duke  of  Chandos4  has  £30,000  in  the 

1  Portland  MSS.,  V.,  591. 

2  Ashe  Windham  (1672-1749)  and  his  brothers,  William, 
M.P.  for  Sudbury,  1722-1727,  and  Aldburgh,  1729-1749,  and 
James,  who  held  a  post  in  the  Salt  Office,  were  the  sons  of 
William  Windham  of  Felbrigg,  in  Norfolk,  by  his  wife  Kath¬ 
erine,  daughter  of  Sir  Joseph  Ashe,  of  Twickenham.  Ashe 
Windham  was  the  father  of  the  statesman,  William  Windham, 
who  inherited  the  family  estates. 

3  Ketton  MSS.,  200. 

4  James  Brydges,  first  Duke  of  Chandos  (1673-1744),  who 
built  the  great  house  at  Canons,  near  Edgware. 


Si  Topulus  (rult  Derep  i  Dece pat  fur 


m 

m 


From  a  print  in  the  Guildhall  Library 


THE  4  BOOM  ’ 


55 


African,  and  that  John  Barber,  the  printer,1  has  got 
£20,000  in  the  South  Sea,  but  I  am  too  much  straitened  in 
my  time  to  give  you  a  list  of  the  lucky  men,  so  must 
refer  you  to  the  public  prints.’ 2 

Every  one  had  the  same  story  to  relate.  4  The  town 
is  quite  mad  about  the  South  Sea,  some  losers,  some 
great  gainers,  one  can  hear  nothing  else  talked  of.  Ex¬ 
change  Alley  is  the  place  of  greatest  resort  now  :  there 
they  call  this  end  of  the  town  Wapping.  It  is  being 
very  unfashionable  not  to  be  in  the  South  Sea.  I  am 
sorry  to  say  I  am  out  of  the  fashion,’ 3  Abigail,  Countess 
of  Kinnoull 4  wrote  to  her  father,  Lord  Oxford,  on  March 
29  ;  and  on  the  same  day  Charlwood  Lawton5  told  the 
ex-Minister,  4  Nobody  talks  of  anything  but  stocks  and 
South  Sea,  and  now  and  then  a  duel.  One  was  fought 
yesterday  between  the  Duke  of  Douglas6  and  Lord 
Dalkeith,7  wherein  I  hear  the  latter  was  much  wounded.’ 8 

There  is  no  doubt  that  the  rise  in  the  price  of  South  Sea 
stock  was  partly  the  result  of  the  apparent  success  of 
Law’s  financial  campaign  in  France.  His  Mississippi 

1  Alderman  John  Barber,  Swift’s  printer,  who  became  a 
millionaire  by  speculation  in  South  Sea  stock,  but  lost  it,  except 
£50,000,  all  by  gambling  in  the  shares  of  other  4  bubbles.’  He 
was  Lord  Mayor  of  London  in  1733. 

2  Portland  MSS.,  V.,  593. 

3  Ibid. 

4  Abigail  (d.  1750),  the  younger  daughter  of  Robert  Harley, 
first  Earl  of  Oxford,  by  his  first  wife,  married  George  Hay, 
seventh  Earl  of  Kinnoull. 

5  Charlwood  Lawton  (1060-1721),  the  friend  of  William  Penn, 
whose  agent  he  was  in  London  for  many  years. 

6  Archibald  Douglas,  third  Marquis  and  first  Duke  of  Douglas 
(1094-1761). 

7  Francis  Scott,  second  Duke  of  Buccleucli  (1694-1751), 
commonly  known  as  Earl  of  Dalkeith,  as  the  dukedom  was  held 
forfeited  owing  to  his  father’s  participation  in  the  Jacobite 
risings. 

8  Portland  MSS.,  V.,  593, 


56 


THE  SOUTH  SEA  BUBBLE 


Company  was  supposed  to  be  vastly  prosperous,  and 
during  the  winter  of  1719-1720  its  shares  went  to  a 
great  premium.  The  Rue  de  Quincampoix,  the  ’Change 
Alley  of  Paris,  vras  daily  thronged  with  excited  specu¬ 
lators,  and  so  eager  w-as  the  demand,  that  capital  stock 
of  the  value  of  500  livres  changed  hands  at  10,000  livres. 
On  January  1,  1720,  the  Mississippi  Company  declared 
a  dividend  of  forty  per  cent,  and  its  stock  rose  to  18,000 
livres.  Five  days  later  Law,  having  entered  the  Roman 
Catholic  Church  in  order  to  be  eligible  for  the  post, 
became  Comptroller-General  of  the  French  finances  ; 
and  on  February  23  he  was  able  to  fulfil  his  dream  of 
uniting  his  Company  wTith  the  Banque  Royale.  English 
newspapers  sneered  at  him.  4  If  you  are  ambitious,  you 
must  put  on  a  sword,  kill  a  beau  or  two,  get  into  New¬ 
gate,  be  condemned  to  be  hanged,  break  prison,  if  you 
can — remember  that ,  by  the  way — get  over  the  wrater  to 
some  strange  country,  set  up  a  Mississippi  stock,  bubble 
a  nation,  and  you  may  soon  be  a  great  man,’  so  ran  a 
paragraph  in  Mist’s  Weekly  Journal ;  and  in  the  same 
publication  on  February  20  some  wag  inserted  :  4  Last 
wreek,  at  the  masquerade  in  the  Llaymarket,  appeared 
a  fine  lady  in  a  very  odd  and  comical  dress  ;  she  told 
the  Company  that  she  came  from  Mississippi,  and  was 
going  to  be  married  to  the  South  Sea.’  It  is  easy  to 
jeer  at  success,  but  difficult  to  affect  it  by  any  effort  of 
the  pen.  In  France,  anyhowr,  Law  wras  regarded  as  the 
greatest  man  of  the  day. 

At  the  same  time,  while  the  effect  of  the  4  boom  ’  in 
France  had  its  influence  upon  the  English  market,  it 
is  important  to  remember  that,  as  a  clear-sighted 
writer  of  the  day  insisted,  4  this  prodigious  rise  of  the 
South  Sea  stock  wras  not  altogether  owing  to  natural 
causes,  but  was  rather  the  result  of  very  artificial 


THE  4  BOOM  ’ 


57 


engines  and  secret  springs  that  were  set  to  work,  both 
at  home  and  abroad,  by  those  who  had  no  small  con¬ 
cern  in  the  success  of  this  affair.’1  In  other  words, 
interested  parties  circulated  extravagant  rumours  likely 
to  send  up  the  price  of  the  stock.  It  was  declared  that 
England  and  Spain  were  on  the  eve  of  contracting  a 
treaty  by  which  the  latter  would  allow  England  a  great 
measure  of  free  trade  to  all  the  South  American  colonies  ; 
and  the  public  was  led  to  believe  that,  as  a  modern 
writer  has  put  it,  4  the  rich  produce  of  the  mines  of 
Potosi-La-Paz  was  to  be  brought  to  England  until  silver 
should  become  almost  as  plentiful  as  iron.  For  cotton 
and  woollen  goods  with  which  we  could  supply  them  in 
abundance,  the  dwellers  in  Mexico  were  to  empty 
their  gold  mines.  The  Company  trading  to  the  South 
Seas  would  be  the  richest  the  world  ever  saw,  and 
every  hundred  pounds  invested  would  produce  hundreds 
of  pounds  per  annum  to  the  stock-holder.’2  In  fact, 
nothing  was  too  absurd  to  be  said,  and,  presently, 
nothing  too  ridiculous  to  be  believed. 

Contrary  to  the  general  expectation,  South  Sea  stock, 
on  the  passing  of  the  Bill,  instead  of  rising,  declined  in 
price.  On  the  day,  April  7,  the  Bill  received  the  Royal 
Assent  the  stock  actually  fell  from  330  to  310,  on  the 
following  day  to  290,  and  on  the  day  after  to  280. 
The  fall  was  in  no  way  due  to  the  waning  of  the  general 
enthusiasm  for  the  scheme,  but  was  the  natural  result 
of  the  profit-taking  of  several  heavy  holders,  and  was 
but  a  passing  phase.  Some  of  the  leading  spirits  among 
the  Directors,  notably  Sir  John  Blunt,  were  dissatisfied, 
and  a  further  crop  of  rumours  favourable  to  the  develop¬ 
ment  of  the  Company  was  deliberately  circulated.  It 

1  Political  State  of  Great  Britain ,  XIX.,  336. 

2  Mackay  :  Popular  Delusions,  I.,  82. 


58 


THE  SOUTH  SEA  BUBBLE 


was  stated,  entirely  without  foundation,  that  the  Spanish 
Government  was  willing  to  give  in  exchange  for  Gibraltar 
and  Port  Mahon  some  ports  on*  the  coast  of  Peru,  that 
would  be  of  the  greatest  value  to  the  trade  of  the  Com¬ 
pany  ;  and  it  was  further  suggested  that  instead  of  one 
annual  ship,  twenty-five  per  cent,  of  the  profits  of  which 
went  to  the  King  of  Spain,  the  Company  was  to  be  at 
liberty  to  send  as  many  ships  as  it  liked,  retaining 
all  the  profits  of  the  venture.  A  credulous  public 
implicitly  accepted  everything  it  heard,  and  then, 
in  its  turn,  exaggerated  what  it  had  heard.  Sir  Isaac 
Newton,  asked  about  the  continuance  of  the  rising  of 
the  stock,  answered  that  he  could  not  calculate  the 
madness  of  the  people.1 

Having,  by  clever  manipulation  of  the  market,  sent 
stock  up  to  325,  the  Directors  of  the  South  Sea  Company 
on  April  12  opened  the  books  for  a  First  Money-Subscrip¬ 
tion  of  £2,000,000,  the  price  of  each  £100  stock  being 
fixed  at  £300,  payable  in  five  instalments  of  £60  each. 
The  demand  was  so  great  that  the  issue  was  increased 
to  £2,250,000,  and,  while  the  old  stock  was  quoted  at 
340,  the  new  issue  was  sold  at  once  for  double  the  price 
of  the  first  payment.  A  few  wise  folk  began  to  fight 
shy  of  the  stock,  but  the  vast  majority  of  the  nation 
began  to  yield  to  the  spirit  of  speculation.  ‘  I  have 
heard  but  one  sound  these  three  months  in  this  place, 
namely  that  of  South  Sea,  which  has  got  the  better  of 
men’s  politics  and  ladies’  fashions,  and  has  entirely 
engrossed  all  conversation,’  Erasmus  Lewis  wrote  to 
Lord  Oxford,  on  April  19.  ‘  There  are  several  calcu¬ 

lations  printed  to  show  that  there  can  be  no  solid 
foundation  for  this  rise.’2 

1  Spence  :  Anecdotes ,  368. 

2  Portland  MSS.,  V.,  594  r 


THE  4  BOOM  ’ 


59 


The  Directors,  who,  about  this  time,  seem  to  have 
cast  prudence  to  the  winds,  and  entirely  to  have  ceased 
to  look  ahead,  now,  on  April  21,  in  order  to  give  further 
stimulus  to  the  stock,  declared  a  dividend,  due  at 
Midsummer,  of  ten  per  cent,  in  stock,  not  only  on  the 
old  capital  but  also  on  the  new  subscription,  and,  at 
the  same  General  Court,  resolved  to  grant  money-loans 
on  stock  as  far  as  £500,000  (which  sum  was  secretly 
enlarged  to  £900,000)  for  four  months  at  five  per  cent. 
Upon  the  declaration  of  this  dividend  stock  rose,  and 
the  Directors  seized  the  opportunity  to  open  a  Second 
Money- Subscription  for  £1,000,000  (increased  to 
£1,500,000),  at  the  rate  of  £400  for  each  £100  stock,  the 
several  payments  to  be  spread  over  a  period  of  three 
years.  At  a  Court  of  Directors  held  on  April  28  it  was 
resolved  to  take  in  the  irredeemable  annuities  into 
their  stock,  and  the  excitement  of  the  proprietors  of 
the  debts  was  remarkable.  4  What  is  yet  more  strange,’ 
said  a  contemporary  writer,  after  commenting  on  the 
rush  to  subscribe  for  South  Sea  stock,  4  so  great  was 
the  confidence  which  monied  men  of  all  ranks  reposed  in 
the  integrity,  however,  and  justice  of  the  Directors  of 
the  South  Sea  Company  that  many  deposited  into  their 
hands  their  annuities,  without  knowing  what  price  the 
Company  would  allow  for  them.’ 1  In  spite  of  this 
statement,  however,  it  may  be  doubted  whether  it  was 
confidence  in  the  Directors  that  impelled  the  annuitants  : 
far  more  probably  was  it  greed,  for  the  same  authority 
remarks  that  a  rumour  was  industriously  circulated 
about  town  to  the  effect  that  the  Company  would  give 
ten  years’  purchase  for  the  irredeemables  in  original 
stock.  On  these  terms,  as  the  stock,  from  the  begin¬ 
ning  to  the  middle  of  May,  stood  at  about  350,  this, 
1  Political  State  of  Great  Britain,  XIX. 


60 


THE  SOUTH  SEA  BUBBLE 


with  the  Midsummer  dividend  of  ten  per  cent,  in  stock, 
meant  that  an  annuity  of  £100  would  yield  £3,635, 
more  than  thirty-six  years’  purchase. 

The  Directors  maintained  a  discreet  silence  until 
May  19,  when,  after  holding  a  Court,  they  published  the 
terms  on  which  they  would  take  in  the  annuities  : — 


£ 

s. 

d. 

For  the  Long  Annuities,  for  every  £100 

per 

annum,  £700  stock  at  £375  per  cent. 

• 

2,625 

0 

0 

and  in  bonds  and  money  . 

• 

575 

0 

0 

i.e.,  thirty-two  years’  purchase  . 

• 

£3,200 

0 

0 

For  the  Fourteen-per-cents.,  for  every  £98 

per 

annum,  £700  stock  at  £375  per  cent. 

• 

2,625 

0 

0 

and  in  bonds  and  money  - 

• 

511 

0 

0 

i.e.,  thirty-two  years’  purchase  . 

• 

£3,136 

0 

0 

For  the  Nine-per-cents.,  for  every  £90 

per 

annum,  £350  stock  at  £375  per  cent 

• 

1,312 

10 

0 

and  in  bonds  and  money  . 

• 

217 

10 

0 

i.e.,  seventeen  years’  purchase 

• 

£1,530 

0 

0 

For  the  Prizes  of  the  Lottery  of  1710,  for  every 

£100  per  annum,  £400  stock  at  £375 

per 

C6Il1^«  •••••• 

• 

1,500 

0 

0 

and  in  bonds  and  money  . 

• 

200 

0 

0 

i.e.,  seventeen  years’  purchase 

• 

£1,700 

0 

0 

For  the  blank  tickets  of  the  Lottery  of  1710,  for 

every  £98  per  annum,  £350  stock  at  £375  per 

cent,  ••••*• 

• 

1,312 

10 

0 

and  in  bonds  and  money  . 

• 

353 

10 

0 

i.e.,  seventeen  years’  purchase 

• 

£1,666 

0 

0 

Here  at  once  were  exposed  the  serious  consequences 
of  the  loosely-drawn  Bill,  under  the  authority  of  which 
the  Company  acted.  The  Company  had  bound  itself 
to  allow  twenty  years’  purchase  for  the  long  annuities 


THE  4  BOOM  5 


61 


and  fourteen  years’  purchase  for  the  short  annuities ; 
but  the  Legislature  had  not  limited  the  price  the  Direc¬ 
tors  were  to  put  on  the  stock  to  be  given  to  the  pro¬ 
prietors.  The  obligations  were,  therefore,  to  all  intents 
and  purposes  a  dead  letter.  As  against  this,  there  was, 
of  course,  no  compulsion  on  the  proprietors  of  the 
annuities  to  exchange  the  public  debt  for  South  Sea 
stock,  while — and  it  is  important  to  note  this  in  favour 
of  the  Directors — those  who  had  subscribed  before  the 
terms  were  published  were  given  six  days  in  which  to 
decide  whether  they  would  adhere  to  or  withdraw  their 
offers.  The  terms  did  not  at  first  find  favour  with  the 
majority  of  the  annuitants,  who,  as  has  been  said,  had 
expected  that  they  would  be  more  generously  dealt 
with,  and  some  did  not  come  in,  while  others  withdrew 
their  application.  For  a  day  or  two  it  looked  as  if  the 
issue  would  not  be  successful.  The  Directors,  however, 
used  every  device  to  send  up  the  price  of  stock,  and  so 
effective  were  their  efforts  that  on  May  25  it  was  quoted 
at  £500.  This  put  an  entirely  different  complexion  on 
the  transaction,  and  the  annuitants,  now  seeing  a 
handsome  profit,  demurred  no  further.  By  May  29 
two-thirds,  roughly,  of  the  annuities  had  been  sub¬ 
scribed.1 

The  daily,  indeed,  the  almost  hourly,  rise  in  the  price 
of  the  South  Sea  stock  made  the  Directors  persons  of 
the  first  consequence.  They  had  it  in  their  power  to 
bestow,  or  withhold,  wealth,  by  allotting,  or  not  allotting, 
stock  which  could  at  once  be  sold  at  a  handsome  profit. 
Their  importance  was  recognised  in  the  highest  circles, 
and  upon  some  baronetcies  were  bestowed.  Humble 

1  Long  annuities  ....  £427,340  18  9 

Nine-per-cents.  ....  48,132  0  0 

Lottery,  1710  .  15,988  4  0 


62 


THE  SOUTH  SEA  BUBBLE 


folk,  who  could  not  so  honour  them,  paid  court  to  these 
persons,  and,  surrounded  by  sycophants,  many  became 
unutterably  arrogant — a  fault  for  which  they  were 
charged  a  very  heavy  figure  when  the  day  of  payment 
came.  In  the  meantime  they  were  scarified  by  a  minor 
poet  in  the  following  verses  : — 

BEGGARS  ON  HORSEBACK. 

This  evil  Solomon  espied 
Among  tiie  rabble-rout, 

That  beggars  did  on  horseback  ride, 

While  princes  walk’d  on  foot. 

South  Sea  has  verify’d  the  same, 

For  mighty  men  of  late 
Are  brought  to  poverty  and  shame, 

Whilst  scoundrels  ride  in  state. 

Bad  news  now  came  from  Paris,  and  made  thoughtful 
people  uneasy  as  to  the  effect  it  might  have  on  the 
money-market  in  this  country.  ‘  The  madness  of  stock- 
jobbing  is  inconceivable.  This  wildness  was  beyond  my 
thoughts,  and,  therefore,  did  not  stay  so  long  for  myself 
or  your  Lordship  as  I  should  have  done,  and  therefore 
have  not  made  so  much  for  you  as  I  would  have  done,’ 
Edward  Harley  wrote  to  Lord  Oxford,  May  23.  ‘  What 

fate  hangs  over  us  is  too  easy  to  be  guessed  from  what 
has  happened  in  France.  The  Regent  is  forced  to 
submit  to  the  Parliament,  Princes  of  the  Blood,  and 
the  inclination  of  the  people.  Some  say  Mr.  Law  is 
committed,  others  that  he  is  secured  by  a  guard,  others 
that  he  is  fled.  What  revolution  this  will  produce 
there,  and  what  influence  it  may  have,  a  little  time  will 
show.’ 1  Further  particulars  were  given  in  a  letter 
from  Thomas  Harley,  a  week  later  :  ‘  The  great  disorders 
at  Paris  on  the  sinking  of  their  stock  from  eighteen 

1  Portland  MSS.,  V.,  597. 


THE  4  BOOM  * 


63 


hundred  to  about  four  hundred  is  in  some  measure 
appeased.  The  Princes  of  the  Blood  being  joined  with 
the  Parliament  of  Paris,  the  Regent  is  forced  to  yield 
to  their  representations,  and  they  are  now  finding  out 
means  to  give  a  currency  to  money,  and  to  make  pro¬ 
vision  that  the  people  who  were  forced  into  the  stocks 
and  compelled  to  take  bank  bills  may  have  their  effects 
secured  to  them.  Law  is  removed  from  the  management 
of  the  revenue,  and  put  to  inspect  his  own  invented 
Bank  and  Company.’ 1 

The  trouble  in  France  was  very  real.  Reckless 
speculation  had  been  the  order  of  the  day,  and  credit 
was  so  far  strained  beyond  recovery  that  on  May  27 
the  Bank  Royale  was  compelled  to  suspend  cash  pay¬ 
ments.  In  obedience  to  the  popular  clamour,  Law,  so 
recently  the  idol  alike  of  society  and  of  the  mob,  was 
removed  from  the  post  of  Comptroller- General,  but  was 
appointed  Intendant- General  of  Commerce  and  Director 
of  the  Bank.  Nothing,  however,  could  avert  the  crash. 
As  is  their  wont,  our  neighbours  indulged  in  epigram : 

‘  Lundi ,  j'achetai  des  actions  ; 

Mardi,  je  gagnai  des  millions  ; 

Merer edi ,  j’arrangerai  mon  menage  ; 

Jeudi ,  je  pris  un  equipage  ; 

Vendredi,  je  m’en  fus  en  bal, 

Et  Samedi ,  a  I’Hopital  ;  ’ 

and  a  light-hearted  wag  suggested  an  epitaph  for  the 
financier  : — 

4  Ci  git  cet  Ecossais  c^lebre, 

Ce  calculateur  sans  egal, 

Qui,  par  les  regies  de  l’algebre, 

A  mis  la  France  a  l’Hopital.’ 

The  ruin  was  widespread,  and  presently  Law  had  to 
fly  the  country,  after  his  house  had  been  attacked  and 

1  Portland  MMS .,  V.,  598. 


64 


THE  SOUTH  SEA  BUBBLE 


he  had  been  compelled  to  seek  refuge  in  the  Palais 
Royale.  In  December  he  was  at  Brussels,  and  there 
received,  and  refused,  an  offer  to  go  to  Russia  to  under¬ 
take  the  management  of  its  finances.  In  the  following 
year  he  paid  a  visit  to  England,  where  he  stayed  awhile, 
having  earlier  received  a  pardon  for  the  death  of  4  Beau  ’ 
Wilson.  He  was  presented  to  the  King,  and  met  many 
men  interested  in  the  problems  of  finance.  4  Though  I 
was  no  stranger  to  Law’s  character,  yet  I  did  not  grudge 
a  bottle  of  wine,  for  the  sake  of  a  little  conversation 
with  one  who  has  made  so  much  noise  in  the  world,’ 
Dr.  William  Stratford1  wrote  to  Edward  Harley, 
October  9,  1722.  4  He  spent  the  evening  with  me. 

I  put  him  upon  the  talking  of  his  own  affairs,  and  he 
entered  into  them  very  readily.  He  seemed  to  take 
it  as  a  great  reflection  on  him,  as  he  well  might,  that 
any  one  should  think  our  South  Sea  scheme  to  have  been 
projected  on  the  plan  of  his  Mississippi.  I  perceive  he 
takes  our  projectors  to  be  great  bunglers.’2  In  1725 
Law  went  to  Italy,  where  four  years  later  he  died  at 
Venice  in  comparative  poverty. 

The  optimism  of  the  people  at  home  was,  however, 
imperturbable,  and  it  largely  counteracted  the  effect 
in  this  country  of  the  crisis  in  France.  They  would  not 
listen  to  warnings,  nor  would  they  weigh  possible  conse¬ 
quences.  4  The  demon  of  stock- jobbing  is  the  genius 
of  this  place,’  Edward  Harley  wrote  to  Lord  Oxford 
from  London,  June  25.  4  This  fills  all  hearts,  tongues 

and  thoughts,  and  nothing  is  so  like  Bedlam  as  the 

1  Dr.  William  Stratford,  son  of  Dr.  Nicholas  Stratford  (suc¬ 
cessively  warden  of  Manchester  College  and  Bishop  of  Chester), 
and  godson  of  Thomas  Harley,  was  Canon  of  Christ  Church, 
Oxford.  Previous  to  his  appointment  to  the  canonry  he  was 
chaplain  to  Robert  Ilarley,  afterwards  first  Earl  of  Oxford. 

2  Portland  MSS.,  VII.,  335. 


-1 

vC 


From  a  contemporary  French  print 


THE  ‘BOOM’ 


65 


present  humour  which  has  seized  all  parties,  Whigs, 
Tories,  Jacobites,  Papists,  and  all  sects.  No  one  is 
satisfied  with  even  exorbitant  gains,  but  every  one  thirsts 
for  more,  and  all  this  founded  upon  the  machine  of 
paper  credit  supported  by  imagination.  This  is  so 
overstretched  that  it  is  no  secret  it  is  in  the  power  of 
France  and  Holland  to  draw  away  every  shilling  in 
England.  If  this  fatal  hour  should  come,  which  in  all 
probability  will,  no  earthquake  can  produce  a  more 
terrible  convulsion.’ 1 

The  great  stock-market  was  in  Exchange,  or  ’Change, 
Alley,  a  broad,  well-paved  place,  by  the  Royal  Exchange. 
At  one  time,  as  Strype  states,  frequented  by  ‘  a  very 
considerable  concourse  of  merchants,  sea- faring  men,  and 
other  traders,’  it  was  now  given  over  almost  exclusively 
to  dealers  in  stocks  and  shares.  It  contained  the  famous 
coffee-houses,  Garraway’s  (often  written  Garway’s)  and 
Jonathan’s.  To  Garraway’s  Swift  refers  in  4  The  South 
Sea  Project,’  and  Defoe  mentions  it  in  1722  in  his 
4  Journey  through  England  ’  :  4  The  Royal  Exchange 

is  the  resort  of  all  the  trading  part  of  this  city,  foreign 
and  domestic,  from  half  an  hour  after  one  till  near 
three  in  the  afternoon  ;  but  the  better  sort  generally 
meet  in  Exchange  Alley  a  little  before,  at  those  cele¬ 
brated  coffee-houses,  called  Garraway’s,  Robins’,  and 
Jonathan’s.  In  the  first,  the  people  of  quality,  who 
have  business  in  the  City,  and  the  most  considerable 
and  wealthy  citizens  frequent.  In  the  second,  the 
foreign  bankers,  and  often  even  foreign  ministers ;  and 
in  the  third,  the  buyers  and  sellers  of  stock.’  So  early 
as  1709,  Jonathan’s  k  described  in  the  Taller  as  4  the 
general  mart  for  stock-jobbers  ’ ;  and  two  years  later, 
Mr.  Spectator,  in  his  first  number,  remarks,  4 1  have 

1  Portland  MSS.,  V.,  599. 


66 


THE  SOUTH  SEA  BUBBLE 


been  taken  for  a  merchant  upon  the  Exchange  for  above 
these  ten  years,  and  sometimes  pass  for  a  Jew  in  the 
assembly  of  stock-jobbers  at  Jonathan’s.5  In  1718 
Mrs.  Centlivre  placed  there  a  scene  in  her  comedy, 
4  A  Bold  Stroke  for  a  Wife.’ 

Among  the  speculators,  there  were,  of  course,  level¬ 
headed  men  of  business  who  were  perfectly  well  aware 
that  South  Sea  stock  was  unduly  inflated,  and  such 
persons,  if  they  dabbled  in  it,  did  so  with  their  eyes  open, 
knowing  full  well  that  they  were  indulging  in  a  wild 
gamble,  and  trusting  to  their  superior  knowledge  and 
trained  intelligence  to  enable  them  to  sell  out  at  a 
profit  before  the  inevitable  4  slump  ’  came.  The  general 
public,  however,  having  no  knowledge  of  stock-market, 
saw  nothing  but  a  continual  rise  in  the  price  of  the 
stock,  and  did  not  pause  to  reflect,  or  were  too  ignorant 
of  such  matters  to  understand,  that  it  could  not  rise 
indefinitely,  and  that  inevitably  in  the  end  the  price 
must  settle  in  a  ratio  to  the  earning  powers  of  the 
corporation.  It  seemed  to  folks  so  simple  that  an 
unprecedented  opportunity  was  presented  to  them  to 
make  large  sums  of  money  with  the  greatest  ease. 
That  the  element  of  risk  entered  into  the  game  never 
occurred  to  them.  The  gamble,  therefore,  attracted 
the  wise,  and  the  unwise,  and  all  sorts  and  conditions 
of  people  became  buyers.  Nor  were  the  buyers  all  of 
one  sex.  Mrs.  Howard 1  bought  and  sold  to  her  exceed¬ 
ing  disadvantage ;  her  friend,  Mrs.  Molesworth,2  how¬ 
ever,  not  only  wras  fortunate  but  was  wise  enough  to 

1  Henrietta  (1688-1767),  the  wife  of  Charles  Howard,  after¬ 
wards  ninth  Earl  of  Suffolk  ;  the  mistress  of  George  II. 

2  Elizabeth  (died  1725),  daughter  of  Dr.  James  Welwood, 
and  wife  of  Captain  the  Hon.  Walter  Molesworth,  fifth  son  of 
Robert  Molesworth,  first  Viscount  Molesworth. 


THE  4  BOOM  ’ 


67 


keep  her  head.  4  To  tell  you  the  truth,’  she  wrote  to 
Mrs.  Howard,  June  25,  1720,  4 1  am  almost  South  Sea 
mad,  and  I  find  that  philosophic  temper  of  mind  which 
made  me  content  under  my  circumstances,  when  there 
was  no  seeming  probability  of  bettering  them,  forsakes 
me  on  this  occasion  ;  and  I  cannot,  without  regret, 
reflect  that,  for  want  of  a  little  money,  I  am  forced  to 
let  slip  an  opportunity  which  is  never  likely  to  happen 
again.  Perhaps  you  will  think  me  a  little  unreasonable 
when  I  tell  you  that  good  Lady  Sunderland1  was  as 
mindful  of  her  absent  friends  as  to  secure  us  a  £500 
subscription,  which  money  my  father  laid  down  for  us, 
and  it  is  now  doubled  ;  but  this  has  but  given  me  a 
taste  of  fortune,  which  makes  me  more  eager  to  pursue 
it.  As  greedy  as  I  seem,  I  should  have  been  satisfied 
if  I  could  by  any  means  have  raised  the  sum  of  £500 
or  £1,000  more,  but  the  vast  price  that  money  bears,  and 
our  not  being  able  to  make  any  security  according  to 
law,  has  made  me  regret  a  scheme  I  had  laid  of  borrowing 
such  a  sum  from  some  monied  friend ;  but  since  I 
have  given  that  over,  I  shall  endeavour  to  be  content 
with  the  share  I  have  in  the  good  fortune  of  my  friends.’2 
Not  all  women,  however,  were  so  reasonable  as  Mrs. 
Molesworth,  as  a  versifier  was  at  pains  to  indicate  : — 

THE  STOCK- JOBBING  LADIES 

Ombre  and  basset  are  laid  aside, 

New  games  employ  the  fair  ; 

And  brokers  all  those  hours  divide 
Which  lovers  used  to  share. 


1  Judith  Tichborne  (d.  1749),  third  wife  of  Charles  Spencer, 
third  Earl  of  Sunderland.  She  was  distantly  connected  with 
the  Molesworth  family.  After  the  death  of  Lord  Sunderland, 
she  married  Sir  Robert  Sutton. 

2  Suffolk  Correspondence ,  II.,  55. 


G8 


THE  SOUTH  SEA  BUBBLE 


The  Court,  the  Park,  the  foreign  song, 

And  harlequin’s  grimace, 

Forlorn  ;  amidst  the  City  throng 
Behold  each  blooming  face. 

With  Jews  and  Gentiles,  undismay’d, 

Young  tender  virgins  mix  ; 

Of  whiskers,  nor  of  beards,  afraid, 

Nor  all  their  cous’ning  tricks. 

Bright  jewels,  polish’d  once  to  deck 
The  fair  one’s  rising  breast, 

Or  sparkle  round  her  ivory  neck, 

Lie  pawn’d  in  iron  chest. 

The  gentle  passions  of  the  mind, 

How  avarice  controls  I 

Ev’n  love  does  now  no  longer  find 
A  place  in  female  souls. 

The  stock  was  quoted  late  in  May  at  550  ;  on  the 
last  day  of  that  month  it  changed  hands  at  600  ;  on 
June  2  it  leapt  to  890.  Then,  it  seemed  suddenly  as  if 
all  were  sellers  and  none  buyers.  A  number  of  specu¬ 
lators,  in  whom  the  sense  of  caution  had  not  become 
atrophied,  realised  that  the  time  had  come  to  take 
their  very  handsome  profits  ;  some  of  these  who  were 
about  to  accompany  the  King  to  Hanover  deemed  it 
expedient,  having  made  far  more  money  than  they 
had  in  their  wildest  dreams  thought  possible,  to  close 
accounts  which  they  could  not  control  from  abroad  ; 
while  yet  others  had  to  dispose  of  some  portion  of  their 
holding  in  order  to  obtain  the  means  to  meet  the  second 
payment  to  their  first  subscription.  The  stock  that  in 
the  morning  was  quoted  at  890,  in  the  afternoon  sold 
at  640,  and  many  who  had  been  speculating  in  differ¬ 
ences  were  utterly  and  hopelessly  ruined.  Before  busi¬ 
ness  closed  for  the  day,  however,  the  market  recovered 
somewhat,  and  closed  at  770.  Four  days  later  the 


THE  ‘BOOM’ 


G9 


price  was  820.  Again  the  prices  were  fictitious,  for 
the  heavy  drop  had  so  alarmed  the  Directors,  to  whose 
interests  it  was  vital  that  the  fall  should  not  be  per¬ 
manent,  that  they  had  sent  their  agents  into  ’Change 
Alley  to  buy  and  buy  and  buy,  until  they  had  stayed 
the  ‘  slump.’  They  then  endeavoured  to  restore  confi¬ 
dence  by  various  expedients.  They  announced  their 
willingness  to  lend  money  to  the  amount  of  £400  upon 
every  £100  of  their  capital  stock  at  the  rate  of  four  per 
cent.  ;  they  gave  notice  that  the  bonds  due  on  June  25 
would  be  paid  forthwith  on  presentation  ;  and,  further, 
consented  to  accept  these  bonds  in  payment  of  the  second 
instalment  of  the  First  Money-Subscription.  The  loans 
served  a  double  purpose,  for  they  not  only  locked  up 
so  much  stock  as  was  pawned,  but  they  also  supplied 
the  borrowers  with  the  means  of  making  further  pur¬ 
chases.  By  these  means  confidence  was  restored,  and 
the  price  maintained,  save  for  occasional  fluctuations, 
until  the  transfer-books  were  closed  on  June  22. 

For  some  time  the  Directors  had  been  making  arrange¬ 
ments  for  a  Third  Money-Subscription,  and  there  had 
been  many  speculations  as  to  the  price  that  would  be  set 
upon  it.  ‘  They  talk  of  a  new  Subscription  at  seven  or 
eight  hundred,’ 1  Thomas  Harley  wrote  to  Lord  Oxford ; 
and  in  the  City  it  was  rumoured  that  it  would  be 
issued  at  a  higher  figure.  One  of  the  Directors,  James 
Edmondson,  was  asked  at  Garraway’s  Coffee-house 
whether  the  report  was  true  that  the  third  Subscription 
would  be  opened  at  1,000,  and  he  replied  facetiously, 
‘  Truly,  gentlemen  seem  to  strive  to  take  us  into  some 
such  price,  whether  we  will  or  not.’ 2  As  a  matter  of 
fact,  although  the  stock  was  quoted  at  800,  the  Directors, 

1  Portland  MSS.,  V.,  597. 

2  Macpherson  :  Annals  of  Commerce,  III.,  82  n. 


70 


THE  SOUTH  SEA  BUBBLE 


aware  that,  owing  to  the  success  that  had  attended 
their  devices,  money  was  plentiful,  did,  with  an  audacity 
which  was  truly  magnificent  and  an  indiscretion  which 
was  as  truly  deplorable,  issue  the  new  Subscription  at 
the  rate  of  £l,000  for  each  £100  capital  stock,  to  be 
paid  in  ten  equal  payments,  one  on  application,  the 
others  at  intervals  of  six  months. 

It  has  been  urged  in  defence  of  the  Directors — mainly, 
it  is  true,  by  members  of  that  body — that  in  offering  the 
stock  at  this  price,  they  were  meeting  the  wishes  of  the 
public.  It  has  also,  in  palliation  of  this  action,  been 
pointed  out  that  even  if  they  had  asked  less,  the  rage 
for  speculation  would  have  forced  it  up  to  the  price  at 
which  it  was  issued.  Certainly  in  this,  as  in  other 
transactions  in  connection  with  the  Company,  the  sub¬ 
scribers  were  to  a  great  degree  responsible  for  the  losses 
which  ultimately  so  crushingly  fell  upon  them,  for,  as 
Macpherson  has  put  it,  4  the  numerous  dealers  in  South 
Sea  stock  and  subscriptions,  by  daily  continuing  to  buy, 
in  the  hope  of  their  still  rising  higher,  of  which  they 
themselves  were  the  principal  cause,  did  undoubtedly  lay 
a  temptation  on  the  managers  for  still  growing  more 
extravagant  in  the  conditions  of  their  future  sub¬ 
scriptions.’1  This  is  undoubtedly  true,  but  the  quarrel 
with  the  Directors  is  that  they  yielded  to  the  temptation 
— the  dishonest  ones  with  an  eye  to  their  own  gains  ; 
the  honest  ones  with  a  view  to  profiting  the  Corporation. 
The  fact  that  the  public  was  willing  to  pay  £1,000  for  a 
£100  stock  was  the  public’s  own  concern  ;  but  when 
the  Directors  asked  this  price  it  was  equivalent  to  stating 
officially  that,  in  the  opinion  of  that  responsible  body, 
it  was  worth  it. 

The  response  to  the  third  Subscription  was  magnifi- 
1  Annals  of  Commerce ,  III.,  81. 


THE  4  BOOM  ’ 


71 


cent.  It  had  only  been  intended  to  offer  £1,000,000 
capital  stock  ;  but  so  great  was  the  demand,  and  so  great 
the  pressure  brought  to  bear  by  influential  persons 
desirous  to  take  this  opportunity  to  reward  their  sup¬ 
porters  by  securing  them  an  allotment,  that  eventually 
the  issue  was  enlarged  to  £4,000,000.  Still  the  rage  for 
stock  continued,  and  the  appetite  for  speculation  was 
fed  by  the  Directors  lending  in  one  day  £3,000,000 
of  the  money  received  as  the  first  payment  on  the  new 
Subscription.  Before  the  end  of  June,  the  new  Sub¬ 
scription  sold  at  above  £200  per  cent,  advance,  while 
early  in  the  following  month  it  was  at  a  premium  of  £330. 

The  Directors,  at  a  Court  held  on  July  8,  resolved  to 
take  in  subscriptions  of  the  Lottery  tickets  and  short 
annuities,  to  the  amount  of  £6,000,000,  and,  again  before 
the  terms  were  announced,  many  proprietors  subscribed 
their  public  debts.  4  It  is  impossible  to  tell  you  what 
a  rage  prevails  here  for  South  Sea  subscriptions  at  any 
price,’  James  Craggs  the  younger  wrote  to  Lord  Stan¬ 
hope  on  July  15.  4  The  crowd  of  those  that  possess 

the  redeemable  annuities  is  so  great  that  the  Bank, 
who  are  obliged  to  take  them  in,  has  been  forced  to  set 
tables  with  clerks  in  the  street.’ 1  When  the  books  were 
closed  at  Midsummer,  the  price  for  the  opening  was 
£1,000,  including  the  dividend  ;  the  first  subscriptions 
at  an  advance  of  £650  per  cent,  and  the  second  at  £610 
per  cent.  These  prices  held,  with  slight  fluctuations, 
during  July,  except  that  the  price  of  the  capital  stock 
declined  to  £930,  in  proportion  as  the  third  Subscription 
rose  to  a  premium  of  £445,  which  may  be  accounted  for 
by  the  fact  that  those  who  have  made  a  profit  out  of 
their  dealings  in  South  Sea  stock  deemed  it  wise  to 
invest  the  proceeds  in  less  adventurous  concerns.  It 
1  Coxe  :  Memoirs  of  Sir  Robert  Walpole ,  II.,  189. 


72 


THE  SOUTH  SEA  BUBBLE 


is  difficult  to  realise  how  great  a  hold  stock- jobbing 
had  at  this  time  upon  the  nation,  but  it  is  brought  home 
to  the  student  by  the  summary  presented  by  Macpherson. 
‘  The  advanced  prices  of  all  those  stocks,  greater  or 
lesser,  of  every  kind,  were  computed,  about  Midsummer 
1720,  to  amount  to  about  £500,000,000  sterling  ;  or 
about  five  times  as  much  as  the  current  cash  of  all 
Europe,5  he  has  written.  4  And  if  the  yearly  rents  of 
all  the  lands  and  houses  do  not  exceed  £14,000,000, 
and  the  utmost  value  thereof,  houses  and  lands  together, 
do  not  exceed  sixteen  years’  purchase  on  an  average, 
or  £224,000,000  ;  then  here  was  above  double  the  value 
of  the  fee- simple  of  all  the  immovable  property  of  the 
nation  in  this  chimerical  traffic.5 1 

The  books  for  taking  in  both  the  irredeemable  and 
the  redeemable  debts  were  open  from  August  3  to 
August  11,  and  the  subscriptions  were  very  heavy.1 2  On 
the  day  after  the  books  were  closed,  the  terms  on 
which  the  Directors  granted  were  published  : — 

For  the  Long  Annuities,  for  every  £100  per  annum,  £ 

£400  stock  at  £800  per  cent.  ....  3,200 

and  in  bonds  and  money  .....  400 

i.e.,  thirty-six  years’  purchase  ....  £3,600 

For  the  Fourteen-per-cents.,  for  every  £98  per  annum, 

£420  stock  at  £800  per  cent.  ....  3,360 

and  in  bonds  and  money  .  .  .  .  .  168 

i.e.,  thirty-six  years’  purchase  ....  £3,528 


1  Annals  of  Commerce ,  III.,  83. 

2  Long  Annuities 
Nine-per-cents. 

Lottery,  1710 
Redeemable  debts  . 


.  £125,392  17  6 

18,750  0  0 

14,906  6  0 

14,393,788  0  0 


THE  ‘BOOM’ 


73 


For  the  Nine-per-cents.,  for  every  £90  per  annum,  £ 
£200  stock  at  £800  per  cent.  ....  £1,600 

i.e.,  seventeen  and  seven-ninth  years’  purchase. 

The  proprietors  of  the  above  annuities  to  receive  the 
Midsummer  dividend  of  ten  per  cent,  in  stock. 

For  the  Prizes  of  the  Lottery  of  1710,  for  every  £100  per  £ 

annum,  £200  stock  at  £800  per  cent.  .  .  1,600 

and  in  bonds  and  money  .  .  .  .  .  150 

i.e.,  seventeen  and  a  half  years’  purchase  .  .  £1,750 

For  the  blank  tickets  of  the  Lottery  of  1710,  for  every 

£98  per  annum,  £210  stock  at  £800  per  cent.  .  1,680 

and  in  bonds  and  money  .....  35 

i.e.,  seventeen  and  a  half  years’  purchase  .  .  £1,715 

For  the  redeemable  debts,  for  every  £100  was  given 
£105  at  £800  per  cent. 

Most  of  the  annuitants  were  at  no  pains  to  hide  their 
disgust  at  these  terms,  which,  they  contended,  con¬ 
trasted  very  unfavourably  with  those  offered  to  the 
first  subscribers.  For  every  £100  per  annum  of  the 
Long  Annuities  there  was  now  given  £3,600  ;  whereas 
for  the  same  security  there  had  been  allowed  on  May  19 
£700  stock  and  in  bonds  and  money  £575,  which,  com¬ 
puting  the  stock  at  £800  per  cent,  (as  it  was  now 
valued),  amounted  to  £6,175 — or  a  difference  of  no  less 
than  £2,575.  There  was  the  same  disparity  in  con¬ 
nection  with  the  other  securities.  Feeling  themselves 
defrauded,  many  subscribers  went  to  the  South  Sea 
House  in  order  to  withdraw  the  securities  they  had 
lodged  ;  but  here  they  were  informed  that  the  Directors 
could  entertain  no  such  applications.  In  the  face  of 
the  clamour  occasioned  by  this  step,  which  was  opposed 
to  the  action  of  the  Directors  in  May  when  they  had 


74 


THE  SOUTH  SEA  BUBBLE 


given  subscribers  six  days  in  which  to  confirm  their 
applications,  the  stock  suffered.  On  August  12  it  stood 
at  920  :  five  days  later  it  could  be  bought  for  the 
opening  of  the  books  on  August  22  at  820. 


CHAPTER  IV 


The  ‘  Bubble  ’  Companies  of  1720 

WHEN  it  became  evident  early  in  the  year  1720 
that  the  public  was  badly  bitten  with  the 
mania  for  speculation,  wily  and  unscrupulous  men  of 
business,  seeing  no  reason  why  the  South  Sea  Company 
should  reap  the  entire  harvest,  decided  to  bleed  the 
gamblers  on  their  own  account.  To  this  end  they 
floated  all  sorts  and  conditions  of  companies.  Many 
of  these  were  merely  wild-cat  schemes  ;  but  others  were 
quite  sound  in  basis,  and  the  objects  for  which  they  were 
ostensibly  founded  have  since  been  successfully  devel¬ 
oped,  but  even  in  these  cases  it  was  generally  not  the 
object  of  the  promoters  to  build  up  a  substantial  busi¬ 
ness  likely  to  yield  a  steady  revenue,  but  to  take  advan¬ 
tage  of  the  spirit  of  gambling  that  was  abroad.  Conse¬ 
quently,  as  a  matter  of  course,  even  the  most  promising 
projects  were  ridiculously  over-capitalised,  and,  with 
maddening  complacency,  millions  were  asked  when  tens 
of  thousands  of  pounds  would  certainly  have  been 
ample  for  working  expenses.  For  4  supplying  London 
with  sea-coal,’  £3,000,000  was  demanded  ;  for  4  paving 
the  streets  of  London,’  £2,000,000  ;  for  4  importing  of 
tobacco,  and  exporting  it  again  to  Sweden,  etc.,’ 
£4,000,000 ;  for  4  importing  timber  from  Wales,’ 
£2,000,000  ;  for  4  erecting  salt-pans  in  Holy  Island,’ 
£2,000,000  ;  and  so  on.  Within  a  few  months  nearly  a 

75 


70 


THE  SOUTH  SEA  BUBBLE 


hundred  4  bubbles,’  as  they  were  called,  with  a  capital 
of  about  £300,000,000,  were  put  on  the  market. 

Some  folks  subscribed  in  all  good  faith,  believing  in 
certain  of  these  schemes  ;  while  others  were  enticed  by 
seeing  the  names  of  some  of  the  greatest  folk  in  the  land 
advertised  as  Governors.  It  became  a  parlour  game 
with  astute  promoters  to  dupe  noblemen  of  unblemished 
reputation  into  acting  unconsciously  as  decoys.  The 
Duke  of  Rutland1  became  Governor  of  the  Copper 
Miners  of  the  Principality  of  Wales ;  the  Duke  of 
Chandos,  Governor  of  the  York  Buildings  Company ; 
and  the  Duke  of  Bridgewater, 2  Governor  of  a  company 
4  for  building  houses  in  London  and  Westminster.’ 
Presently,  as  will  be  seen,  even  Royalty  itself  succumbed, 
at  a  price,  to  these  insidious  attentions. 

It  must  not  be  thought,  however,  that  the  people  as 
a  whole  had  lost  their  wits.  They  had  merely  suc¬ 
cumbed  to  the  greed  of  gain.  It  was  only  a  very  small 
minority  which  believed  that  the  schemes  were  feasible, 
or  that,  even  if  feasible,  they  would  necessarily  be 
profitable  ;  and  it  was  only  this  very  small  minority 
which  cared.  The  vast  majority  only  wanted  to  buy 
something  cheap,  sell  it  dear,  and  pocket  the  difference. 
So  long  as  they  could  do  this,  the  4  bubbles,’  so  far  as 
they  were  concerned,  amply  justified  their  existence. 
So  long  as  there  was  something  to  sell,  it  did  not  in  the 
least  matter  what  it  was,  for  the  second  purchaser 
bought  it  with  the  same  object  as  the  first — to  get  rid 
of  it  at  a  profit  so  soon  as  possible.  Indeed,  anything 

1  John  Manners,  second  Duke  of  Rutland  (d.  1721). 

2  Scroop  Egerton,  fourth  Earl  and  first  Duke  of  Bridgewater 
(1681-1745),  the  constructor  of  the  Bridgewater  canal ;  created 
Duke,  1720.  His  first  wife  was  Elizabeth,  daughter  of  the 
first  Duke  of  Marlborough. 


lAtr  L%i*.  ef  defiant  Sea/,  c  t  dfup/ ,  and  CFetf  •  '-^~\ 
ltd  ivith  the  .Oife  of  Itaval  Oil  A  their  tiaif/ ,’  n 
Hlun  all  that  the  Prefecter/,  Ah/fn  or  Wi)hjt>r ,  v_ 
If  ter  catch  ’Steal/,  the  only  Chuhf  that  Au/h^/tr  hiL*. 


Cam*  alt  vc  i u >U  my  'Water  It.  name  buy  ,  tS~) 
s CjrShunp  re i:r~ ^ fla ended  •  Ahnea ,  and  Cole  Ptf  dry/ 
Same  Proieetf  at  e  all  Wind,  hut  tturJ  u *  Slater  , 

And.  ‘he  at  prevention’,  may  rife  here*  ter  . 


r~' 


“  Bubble  ”  Playing-Cards — I 


P-  76 


From  the  Schreeber  Collection  in  the  British  Museum 


‘BUBBLE5  COMPANIES 


77 


served  for  the  purpose — it  was  merely  used  as  a  gambling- 
counter.  4  We  can  well  remember,5  Macpherson  has 
written,  4  one  of  these  names,  44  Globe  Permits,55  which 
came  to  be  currently  sold  for  £60  upwards  in  the  Alley, 
which  nevertheless  was  only  a  square  bit  of  playing- 
card,  on  which  was  the  impression  of  a  seal  in  wax, 
being  the  sign  of  the  Globe  Tavern  in  the  neighbour¬ 
hood,  with  the  motto  or  inscription  of  sail-cloth  permits 
(without  any  name  signed  thereon),  the  possessors 
thereof  to  be  hereafter  permitted  to  subscribe  to  a  new 
sail-cloth  manufactory,  projected  by  one  who  was 
then  known  to  be  a  man  of  fortune,  though  after¬ 
wards  involved  in  great  calamities  and  disgrace.5 1  The 
wise  bought  one  day  and  sold  the  next — sometimes, 
indeed,  the  same  day,  for,  such  was  the  confusion,  that 
shares  were  cried  occasionally  at  the  same  time  ten 
per  cent,  higher  at  one  end  than  the  other  of  ’Change 
Alley. 

4  Subscribers  here  by  thousands  float, 

And  jostle  one  another  down  ; 

Each  peddling  in  his  leaky  boat, 

And  here  they  fish  for  gold,  and  drown. 

4  Now  buried  in  the  depth  below, 

Now  mounted  up  to  Heaven  again, 

They  reel  and  stagger  to  and  fro, 

At  their  wits’  end,  like  drunken  men. 

4  Meantime,  secure  on  Garway’s 1  2  cliffs 
A  savage  race,  by  shipwreck  fed, 

Lie  waiting  for  the  founder’d  skiffs, 

And  strip  the  bodies  of  the  dead. 

4  But  these,  you  say,  are  factious  lies, 

From  some  malicious  Tory’s  brain  ; 

For,  where  directors  get  a  prize, 

The  Swiss  and  Dutch  whole  millions  drain. 


1  Annals  of  Commerce ,  III.,  89. 

2  Garraway’s  Coffee-house. 


78 


THE  SOUTH  SEA  BUBBLE 


*  Thus,  when  by  rooks  a  lord  is  plied, 

Some  cully  often  wins  a  bet, 

By  venturing  on  the  cheating  side, 

Though  not  into  the  secret  let. 

‘  While  some  build  castles  in  the  air, 

Directors  build  them  in  the  seas, 

Subscribers  plainly  see  them  there, 

For  fools  will  see  as  wise  men  please.’  1 

In  vain  were  warnings  increasingly  given  by  those 
who  were  clear-sighted  enough  to  realise  that  disaster, 
total  and  crushing,  must  inevitably  be  the  result  of  this 
mad  gambling.  To  Chetwood 2  must  be  given  great 
credit  for  his  endeavours  to  stem  the  craze  by  pouring 
ridicule  upon  it  in  his  little  satires,  4  South  Sea,  or,  The 
Biters  Bit,  a  tragi-comi-pastoral  farce,  humbly  in¬ 
scribed  to  the  reading  of  the  honest  director  ’ ;  and  4  The 
Stock-Jobbers,  or,  The  Humours  of  Exchange  Alley.5 
4  Exchange  Alley,  or,  The  Stock-Jobber  turned  Gentle¬ 
man  ;  with  the  Humours  of  our  Modern  Projectors. 
A  tragi-comical  farce,  humbly  inscribed  to  the  gentlemen 
daily  attending  at  Jonathan’s  Coffee-house  ’  was  also 
from  his  pen.  4  Exchange  Alley  ’  has  a  preface,  which 
indicates  the  purpose  of  the  author  : — 

4  The  whims  of  the  stocks  in  this  kingdom  is  of  late 
so  far  cultivated  and  improved  from  a  foreign  example, 
that  one  might  reasonably  conclude  the  numerous  in¬ 
habitants  of  this  great  metropolis  had  for  the  most  part 
deserted  their  stations,  business,  and  occupations  ;  and 
given  up  all  pretensions  to  industry,  in  pursuit  of  an 
imaginary  profit. 

4  If  your  occasions  be  never  so  urgent  for  a  mercer,  a 
tailor,  a  shoemaker,  etc.,  they  are  nowhere  to  be  met 

1  Swift  :  The  South  Sea  Project . 

2  William  Rufus  Chetwood  (d.  1760),  bookseller  and  drama¬ 
tist,  author  of  a  ‘  General  History  of  the  Stage,’  1749. 


6  BUBBLE  5  COMPANIES 


79 


with  but  at  the  Royal  Exchange.  If  you  resort  to 
any  public  office  or  place  of  business,  the  whole  enquiry 
is,  How  are  the  stocks  ?  If  you  are  at  a  coffee-house, 
the  only  conversation  turns  on  the  stocks;  even  the 
scandal  of  the  tea-table  is  forgotten.  If  you  repair  to  a 
tavern,  the  edifying  subject  (especially  to  a  philosopher) 
is  the  South  Sea  Company ;  if  you  wait  on  a  lady  of 
quality,  you’ll  find  her  hastening  to  the  House  of 
Intelligence  in  Exchange  Alley ;  and  what  is  strange 
and  wonderful,  her  very  dress,  diamond  shoe-buckles, 
and  garters,  are  neglected  for  the  stocks. 

4  Even  smocks  are  deposited  to  help  make  up  the 
security  for  cash;  jewels  pawned  to  raise  money  for  the 
purchase  of  ruin — and,  perhaps,  wives  and  daughters 
have  been  mortgaged  for  the  very  same  purpose.  To  that 
degree  of  lunacy  are  the  people  of  this  age  arrived,  that 
they’ll  be  nowhere  eased  of  the  burden  of  their  case 
but  in  Exchange  Alley.  Twenty  per  cent,  is  parted 
with  for  a  bare  week’s  loan  of  one  hundred  pounds, 
in  expectation  of  a  miser’s  gain  (though  the  consequence 
be  further  loss) ;  and  if  fame  be  not  a  great  calumniator, 
some  persons  of  distinction  have  generously  condescended 
to  lay  in  limbo  their  St - rs  and  G - rs. 

4  When  these  extraordinary  events  are  considered, 
and  women  of  the  town  are  become  dealers  in  the  stocks, 
valets  de  chambre,  footmen,  and  porters  (as  well  as 
merchants,  tradesmen,  and  pickpockets)  walk  on  the 
Exchange,  and  ride  in  their  coaches  at  the  same  time 
some  good-natured  gentlemen  have  quitted  them ; 
projectors  successfully  bubble  the  public  in  all  their 
schemes ;  sharpers  leave  their  gaming-tables  in  Covent 
Garden  for  the  more  profitable  business  at  Jonathan’s 
Coffee-house ;  and  even  poets  commence  stock-jobbers,  it 
is  high  time  to  pronounce  Exchange  Alley  truly  a  farce.’ 


80 


THE  SOUTH  SEA  BUBBLE 


The  dramatis  personae  of  4  Exchange  Alley  ’  includes 
Mississippi  .  .  A  merchant  dealing  in  stocks, 


Bite 

Cheat-all 

Bubble 

Africanus 

Craye-move 


A  stock- jobber, 

A  broker, 

A  promoter, 

A  new  created  gentleman, 

A  female  stock-jobber ; 
and  the  little  skit,  though  in  a  crude  manner,  hit  off 
effectively  the  folly  of  the  day.  One  scene,  especially, 
put  the  matter  very  clearly  before  those  who  had  eyes 
to  see. 

4  Bubble.  First  an  Insurance  of  ships  to  the  spacious 
World  of  the  Moon — a  project  for  building  a  fleet  of 
flying  ships  of  the  greatest  burden  .  .  .  noses  insured 
from  fire  ...  to  furnish  rods  to  flog  the  universities 
abroad — to  make  hoop  petticoats — to  show  bears, 
monkeys,  and  monsters — to  make  hempen  halters — I 
think  this  is  an  ample  list  of  projects,  Mr.  Cheat- 
all. 


4  Cheat- all.  You’re  right ;  but  what  will  be  the 
certain  depending  profit  from  these  mighty  schemes  ? 

4  Bubble.  Only  as  much  as  we  can  genteelly  get  by 
subscription - 

4  Cheat- all.  What  will  that  amount  to  ? 

4  Bubble.  About  four  or  five  millions — a  sum  which 
will  make  three  or  four  persons  very  easy  in  their 
circumstances. 

4  Cheat- all.  But  I’m  afraid  of  the  Charter  for 
Halters,  lest  our  necks  should  be  deservedly  slipt  into 
the  suffocating  noose. 

4  Bubble.  There’s  no  danger  of  that,  my  dear.  I’ve 
a  certain  charm  that  will  effectually  gain  the  consent  of 
the  subscribers,  and  they’ll  be  more  ready  to  part  with 
their  money  than  we  to  receive  it. 


4  BUBBLE  ’  COMPANIES  81 

4  Cheat- all.  What  alluring  bait  is  that,  my 
dear  ? 

4  Bubble.  Only  that  of  extraordinary  gain — a  plau¬ 
sible  scheme  for  procuring  them  cent,  per  cent,  is  a  snare 
they  have  no  power  to  avoid.  They’ll  deposit  their  cash 
with  eagerness,  and,  like  the  dog  in  the  fable,  catching 
at  the  shadow,  willingly  resign  the  substance. 

4  Cheat- all.  I  find  by  experience  you’re  a  man  of 
design. 

4  Bubble.  To  convince  you  that  I  have  already  found 
success — there’s  a  subscription  for  one  million  which  I 
completed  last  week — for  five  hundred  thousand  pounds 
I  have  filled  this  week  in  one  day — and  one  hundred 
thousand  pounds  in  an  hour.  (Pulling  out  papers.) 

4  ChExUT-all.  You  are  a  person  of  business  indeed — 
and  uncommon  dispatch. 

4  Bubble.  I’ll  dispatch  their  money,  old  boy.  I 
shall  now  be  no  longer  without  those  dear  companions, 
a  bottle  and  a  mistress  ;  and  I’ve  already  bespoke  a 
coach-and-six,  half  a  dozen  liveries,  am  treating  for 
an  estate  of  four  thousand  pounds  a  year,  and  all  at 
the  expense  of  the  public.  Oh,  here  comes  a  set  of 
subscribers  for  the  day. 

(Enter  several  subscribers  of  both  sexes.) 

4  First  Subscriber.  Sir,  I’m  come  to  insure  my 
ship  and  family  to  the  World  of  the  Moon.  There’s  my 
subscription  (giving  bubble  money).  Is  it  a  pleasant 
country  ? 

4  Bubble.  The  pleasantest  climate  in  the  world,  sir. 
When  I  was  last  there  at  Christmas,  the  meadows  were 
beautifully  green  and  odoriferous,  and  the  corn  almost 
in  its  full  perfection  of  ripeness. 

4  Second  Subscriber.  There’s  my  subscription  to- 


82 


THE  SOUTH  SEA  BUBBLE 


wards  the  fleet  of  flying  ships.  But  how  d’ye  prepare 
the  wings,  Mr.  Bubble  ? 

4  Bubble.  Dexterously,  sir.  The  vessels  are  so  finely 
and  artificially  built,  that  the  single  wing  of  a  goose 
is  sufficient  to  waft  them  through  the  air  with  the 
expedition  of  the  swiftest  bird. 

4  Second  Subscriber.  Wonderful  truly.’ 

These  well-intentioned  folk,  bleating  their  simple 
warnings,  might  as  well  have  kept  their  breath  to  cool 
their  porridge.  In  vain  did  newspapers  point  out  the 
folly  of  it  all.  No  one  heeded.  Not  even  when  a  paper 
announced  that  at  some  (sham)  address,  4  On  Tuesday 
next,  books  will  be  opened  for  a  subscription  of 
£2,000,000  for  the  invention  of  melting  down  sawdust 
and  chips,  and  casting  them  into  clean  deal  boards 
without  cracks  or  knots,’  did  people  pause  in  their  wild 
career.  Not  even  a  practical  joke  made  any  appreci¬ 
able  impression  on  them.  4  Here  has  been  the  oddest 
bite  put  upon  the  Town  that  ever  was  heard  of,’  so  ran 
a  paragraph  in  the  Weekly  Packet ,  January  2,  1720. 
4  We  having  of  late  had  several  new  subscriptions  set 
on  foot  for  raising  great  sums  of  money  for  erecting 
offices  of  Insurance,  etc.,  at  length  some  gentlemen, 
to  convince  the  world  how  easy  it  was  for  projectors  to 
impose  upon  mankind,  set  up  a  pretended  office  in 
Exchange  Alley  for  the  receiving  of  subscriptions  for 
raising  a  million  of  money  to  establish  an  effectual 
Company  of  Insurers,  as  they  called  it.  Upon  which, 
the  day  being  come  to  subscribe,  the  people  flocked  in, 
and  paid  five  shillings  for  every  £1,000  they  subscribed, 
pursuant  to  the  Company’s  proposal ;  but  after  some 
hundreds  had  so  subscribed  (that  the  thing  ought  to  be 
freely  known)  the  gentlemen  were  at  the  expense  to 
advertise  that  the  people  might  have  their  money  back 


4  BUBBLE  ’  COMPANIES 


83 


again  without  any  deductions  ;  and  to  let  them  know 
that  the  persons  who  paid  in  their  money  contented 
themselves  with  a  fictitious  name,  set  by  an  unknown 
hand,  to  the  receipts  delivered  out  for  the  money  so 
paid  in  ;  and  that  the  said  name  was  composed  only 
of  the  first  letters  of  six  persons’  names  concerned  in 
the  said  publication.’ 

These  jeux  d’esprits,  however,  failed  entirely  of  their 
purpose,  because,  as  a  matter  of  fact,  they  were  scarcely 
burlesques  of  the  objects  of  many  of  the  4  bubbles.’ 
A  company  to  produce  4  a  wheel  for  perpetual  motion  ’ 
demanded  £1,000,000  ;  and  three  times  that  sum  was 
asked  for  by  another  company  for  the  deliciously  in¬ 
definite  purpose  of  4  trading  in,  and  improving,  certain 
commodities  of  the  produce  of  this  kingdom.’  A  scheme 
for  4  a  grand  dispensary’  required  a  capital  of  £3,000,000; 
and  promoters  desired  vast  sums  for  concerns  formed 
4  for  the  more  effectual  making  of  bays  in  Colchester 
and  other  parts  of  Great  Britain,’  and  4  for  buying  and 
fitting  out  ships  to  suppress  pirates.’  Besides  the 
schemes  designed  merely  to  benefit  their  projectors, 
there  were  also  companies  constructed  for  purposes 
dear  to  the  heart  of  the  promoter,  with  whom  personal 
profit  was  a  secondary  consideration.  Every  man  who 
had  a  hobby  now  exploited  it.  Sir  Richard  Steele 
believed  it  possible  to  4  bring  fresh  fish  by  sea  to  Lon¬ 
don  ’ ;  and  a  visionary  thought  it  would  be  profitable 
to  extract  silver  from  lead.  Aaron  Hill’s 1  project 
for  4  making  beach- oil  ’  was  revived ;  and  Jezreel 

1  Aaron  Hill  (1685-1750),  poet  and  dramatist,  being  granted 
in  1713  a  patent  for  a  method  of  extracting  oil  from  beechmast, 
founded  a  company  with  a  capital  of  £45,000,  which  collapsed 
three  years  later.  When  the  scheme  was  revived  in  1720, 
there  is  no  evidence  that  he  was  connected  with  it. 


84 


THE  SOUTH  SEA  BUBBLE 


Jones 1  wanted  to  develop  the  trade  with  Barbary ; 
and  Sir  Robert  Montgomery  2  that  to  the  Golden 
Islands  ;  while  Sir  Richard  Manningham  3  wanted  to 
plant  mulberry-trees  and  breed  silk-worms  in  Chelsea 
Park.  James  Puckle 4  formed  a  company  to  exploit 
his  machine  gun  ;  and  a  clergyman  was  consumed  with 
the  desire  to  import  jackasses  from  Spain  in  order  to 
propagate  a  larger  kind  of  mule  in  England,  for  which  pur¬ 
pose  he  acquired  marsh  lands  near  Woolwich.  So  many 
and  curious  were  the  unauthorised  companies  in  exis¬ 
tence  in  1720  that  the  following  list,  though  by  no  means 
complete,  will  be  found  at  once  instructive  and  amusing.6 

Insurance  Companies  : — Sadler’s  Hall  Insurance 
(afterward  united  to  the  Royal  Exchange  Assur- 

1  Jezreel  Jones  (d.  1731),  traveller,  visited  Barbary  in  1698 
and  again  in  1701.  Three  years  later  he  went  as  British  envoy 
to  Morocco. 

2  Sir  Robert  Montgomery,  of  Skelmorlie,  eleventh  baronet 
(1680-1731).  He  received  in  1717  from  the  Lords  Proprietors 
of  Carolina  a  grant  of  lands  between  the  rivers  of  Altamaha 
and  Savanna,  which  he  proposed  to  colonise.  The  Crown 
subsequently  assuming  the  government,  the  project  to  settle 
the  Golden  Islands  was  perforce  abandoned. 

3  Richard  Manningham  (1690-1759),  man-midwife,  knighted 
1721.  He  figures  in  4  Tristram  Shandy,’  and  was  the  author 
of  several  works  on  obstetrics.  Two  thousand  mulberry-trees 
were  planted  and  many  large  and  costly  buildings  were  erected 
at  Chelsea  ;  but  the  scheme  came  to  nothing. 

4  James  Puckle  (1667  ?-1724),  author  of  4  The  Club.’  He  had 
in  1718  taken  out  a  patent  for  his  invention  of  a  quick-firing  gun. 

6  The  verses  given  in  the  foot-notes  are  taken  from  the 
4  bubble  playing-cards,’  each  of  which  has  an  engraving  and 
some  lines  4  by  the  author  of  the  44  South  Sea  Ballad  ”  and  the 
44  Tippling  Philosopher  ”  ’  relating  to  one  of  the  projects.  This 
was  advertised  in  the  Post  Boy ,  October  20,  1720  ;  and  there 
is  a  pack  in  the  British  Museum.  The  author  has  been  unable 
to  trace  4  A  new  pack  of  Stock- Jobbing  cards,’  with  lines  by 
the  same  writer,  advertised  on  the  following  December  10  in 
the  Weekly  Packet  and  Mist’s  Weekly  Journal. 


4  BUBBLE  5  COMPANIES 


85 


ance) 1 ;  British  Assurance 2 ;  Shaler’s  Assurance ;  General 
Insurance  against  Fire  (capital,  £1,200,000)  3 ;  Friendly 
Society  for  Insurances  ;  For  insuring  of  horses  and  cattle 
(capital,  £2,000,000) 4 ;  For  insuring  of  houses  and  goods 
in  Ireland ;  For  insuring  against  theft  and  robbery ; 
For  insuring  to  all  masters  and  mistresses  the  losses 
they  shall  sustain  by  servants  (capital  £3,000,000) ; 
For  assurance  of  seamen’s  wages  ;  For  insuring  and 
increasing  children’s  fortunes. 

Financial  Companies  : — The  Bottomry  Society 5 ; 

1  Insurance  on  Lives. 

4  Come  all  ye  gen’rous  husbands,  with  your  wives, 

Insure  round  sums  on  your  precarious  lives  ; 

That  to  your  comfort,  when  you’re  dead  and  rotten, 

Your  widows  may  be  rich  when  you’re  forgotten.’ — 

[aS'm?  of  Spades.] 

2  Insurance  on  Ships ,  etc. 

‘  In  vain  are  all  insurances,  for  still 
The  raging  winds  must  answer  Heaven’s  will ; 

To  what  wise  purpose  do  we  then  insure, 

Since  some  must  lose  whate’er  the  sea  devour.’ — 

[*Sftr  of  Diamonds.] 

3  Insurance  from  Fire. 

4  Projecting  sure  must  be  a  gainful  trade 
Since  all  the  elements  are  bubbles  made. 

They’re  right  that  gull  us  with  the  dread  of  fire, 

For  fear  makes  greater  fools  than  fond  desire.’ — 

[i Seven  of  Clubs.] 

4  Insurance  on  Homes. 

4  You  that  keep  houses  to  preserve  your  ease, 

And  pads  to  please  your  wives  and  mistresses, 

Insure  their  lives,  and  if  they  die  we’ll  make 
Full  satisfaction,  or  be  bound  to  break.’ — 

[Four  of  Diamonds.] 

5  Lending  money  upon  Bottom-ree. 

4  Some  lend  this  money  for  the  sake  of  more, 

And  others  borrow  to  increase  their  store  ; 

Both  these  do  oft  engage  in  bottom-ree, 

But  curse  sometimes  the  bottom  of  the  sea.’ — 

[Queen  of  Clubs.] 


86 


THE  SOUTH  SEA  BUBBLE 


The  Million  Bank  ;  For  lending  money  to  merchants 
to  pay  their  duties,  for  purchasing  Government  securities, 
for  granting  annuities,  and  for  building  ships  to  let  for 
freight  1 ;  For  lending  money  on  stocks,  annuities, 
tallies,  etc. ;  For  lending  money  at  interest ;  For 
erecting  loan  offices  for  the  assistance  and  encouragement 
of  the  industrious  poor  (capital,  £2,000,000);  For  pay¬ 
ing  pensions  to  widows,  etc.,  at  a  small  discount  (capital, 
£2,000,000) ;  For  buying  seamen’s  tickets  ;  For  general 
remittance  and  insurance  of  debts  ;  Slogden’s  Insur¬ 
ances;  West’s  permits  for  buying  and  selling  stock. 

Land  and  Building  Companies  : — For  purchasing 
and  leasing  improbable  lands  in  Great  Britain  (Sir  John 
Lambert’s  project ;  capital,  £4,000,000)  2 ;  For  im¬ 
proving  lands  in  Flintshire  (capital,  £1,000,000) ;  For 
purchasing  and  improving  fenny  lands  in  Lincolnshire 
(capital,  £2,000,000) ;  For  purchasing  and  improving 
a  royalty  in  Essex  ;  For  purchasing  the  forfeited  estates 
(capital,  £1,200,000) ;  For  purchasing,  or  recovering, 
estates  illegally  detained 3 ;  For  buying  and  selling 

1  Building  ships  to  let  for  freight. 

4  Who  but  a  nest  of  blockheads  to  their  cost 
Would  build  new  ships  for  freight  when  trade  is  lost ; 

To  raise  fresh  barks  must  surely  be  amusing 
When  hundreds  rot  in  docks  for  want  of  using.’ — 

[Seven  of  Hearts.'] 

2  Sir  Jn.  L - Vs  improvement  of  land. 

4  The  famous  knight  that  is  the  sole  projector 
Of  this  new  Bubble  is  a  South  Director, 

But  ’twould  be  better  taken  at  his  hands 
To  raise  for  South  Sea  than  improve  poor  lands.’ — 

[Ace  of  Diamonds.] 

3  Purchasing  of  estates  illegally  detained. 

4  You  that  have  dormant  titles  to  estates, 

Pil’d  on  your  closet  shelves  to  feed  the  rats, 

Sell  them  to  us,  we’ll  gratify  your  spite 

And  plague  the  rogues  that  rob  you  of  your  right.’ — 

[Ten  of  Diamonds.] 


STTii  L 


tlTm7 


provem  ent  of  L  an  c 


/&  unhW’^ 


taxmens  *JZ/iuphk^tfuU'  iS  iht^<ArltdProp 
\w  flat*  Hubble^  a  South  Direct&r 
truvuU  hr  hrittr  tahen  at  hi/  iHanJ/ 
cute  JPoun  ^fouth  *J~r&  than  XmprcrtH  , 


W 


turn  \  linn*  of  Fu  n  erali?  f 
all  parts  of  Great  Britain. 


Come  all  tft  Afortul/  Jhu'  of  act  , 

And  sjrdtmn  Jkmpr  pour  fmicrd/  J%aU  i mtc* 

did  SkatintM /  Jhall  attend  each  dCarf? 

.  IndScare  ~tron*/  en&huk  Cowry  compltJt  du 


irr prrferi**  pour  ^ 

te  pi **J*  your  fhvt*.' ,  and  HAliflrcfin/  , 
tlbur  I  arcs ,  and  if'  lAoo  Iht  rvc  //  male  — 
or  hr  Ivund  fo  7j  rrah  . 


Settling  Co  it 

i _ 


riles  iji 
mm  erica 


'Jir  that  y  Huh  ,  and  want?  to* find  arvjy  , 
idptrrttru?  ^  unt,  in  S forth  %4mrrtca  ,  • 
hit  hurt  %,/ ub fertbe  hirnfrl/  adUadlonp  barer 

And  _Ear/t  Ofutll  ifCmjur  Aim.  or  2tt.tr 


J 


“Bubble”  Playing-Cards— II 


From  the  Schrecbcr  Collection  in  the  British  Museum 


4  BUBBLE  ’  COMPANIES 


87 


lands,  and  lending  money  at  interest  (capital,  £5,000,000) ; 
For  the  effectual  making  of  bays  in  Colchester  and  other 
parts  of  Great  Britain ;  For  purchasing  lands  /or  the 
corn-trade1;  For  purchasing  lands,  and  the  improve¬ 
ment  of  tillage  and  the  breed  of  cattle  ;  For  erecting 
turnpikes  and  wharves  ;  For  the  improving  of  gardens  ; 
For  improving  the  breed  of  horses,  and  the  improvement 
of  glebe  and  church  lands,  and  rebuilding  parsonage 
and  vicarage  houses  ;  For  planting  madder  ;  For  man¬ 
uring  of  land  2 ;  For  purchasing  grounds  to  build  on  in 
London  (capital,  £2,000,000) ;  For  building  and  rebuilding 
houses  throughout  England  (capital,  £3,000,000) ;  For 
erecting  houses  or  hospitals  for  taking  in  and  maintain¬ 
ing  bastard  children  (capital,  £2,000,000) ;  For  cleansing 
and  paving  London  streets  (capital,  £2,000,000).3 

Fishery  Companies  : — For  carrying  on  the  Royal 
Fishery  of  Great  Britain  (capital,  £10,000,000)  4  ; 

1  The  Freeholder. 

6  Come,  all  ye  spendthrift  prodigals  that  hold 
Free  land  and  want  to  turn  the  same  to  gold  ; 

We’ll  buy  you  all,  provided  you’ll  agree 
To  drown  your  purchase-money  in  South  Sea.’ — 

[King  of  Clubs.] 

2  Manuring  of  land. 

4  A  noble  undertaking  but  abus’d, 

And  only  as  a  tricking  bubble  us’d  ; 

Much  they  pretend  to,  but  the  public  fear 
They’ll  never  make  corn  cheap,  or  horse  dung  dear.’ — 

[Tivo  of  Hearts.] 

3  Cleaning  the  streets. 

4  A  cleanly  project  well  approv’d,  no  doubt, 

By  strolling  dames,  and  all  that  walk  on  foot ; 

This  bubble  well  deserves  the  name  of  best, 

Because  the  cleanest  bite  of  all  the  rest.’ — 

[Three  of  Spades.] 

4  Royal  Fishery  of  Great  Britain. 

4  They  talk  of  distant  seas,  of  ships  and  nets, 

And  with  the  style  of  Royal  gild  their  baits  ; 


88 


THE  SOUTH  SEA  BUBBLE 


Cawood’s  North  Sea  Fishery  ;  British  Fishery  ;  Grand 
American  Fishery *  1 ;  Greenland  Whale  Fishery  (Sir 
John  Lambert’s  project)  2 ;  Greenland  Trade  Fishery  3 ; 
Garraway’s  (or  Pillan’s)  Fishery ;  Free  Fishery ; 
Coral  Fishery4;  Orkney  Fishery;  National  Permits 
for  a  Fishery  (George  James’s  project ;  capital, 
£300,000). 

Water,  River,  and  Harbour  Companies  : — For 
repairing  Morison’s  Haven  ;  For  an  engine  to  take  up 
ballast ;  For  making  the  river  Dee,  in  Cheshire, 
navigable ;  For  making  the  river  Douglas  navi- 


When  all  that  the  projectors  hope  or  wish  for, 

Is  to  catch  fools,  the  only  chubs  they  fish  for.’ — 

[Five  of  Hearts.] 

1  Grand  Fishery. 

4  Well  might  this  bubble  claim  the  style  of  grand, 

Whilst  they  that  raised  the  same  could  fish  by  land  ; 

But  now  the  town  does  at  the  project  pish, 

They’ve  nothing  else  to  cry  but  stinking  fish.’ — 

[Two  of  Spades.] 

2  Whale  Fishery. 

4  Whale  fishing,  which  was  once  a  gainful  trade, 

Is  now  by  cunning  heads  a  bubble  made  ; 

For  round  the  ’Change  they  only  spread  their  sails, 

And  to  catch  gudgeons  bait  their  hooks  with  whales.’ — 

[King  of  Hearts], 

3  Greenland  Trade. 

*  This  project  was  to  catch,  to  cut,  and  boil 
Huge  whales  and  other  monstrous  fish  to  oil, 

A  stinking  bubble,  tho’  of  late  so  dear, 

Yet  now  the  greatest  sharers  shrink  for  fear.’ — 

[Two  of  Diamonds.] 

4  Coral  Fishery. 

4  Coral,  that  beauteous  product  only  found 
Beneath  the  water  and  above  the  ground, 

If  fish’d  for  as  it  ought  from  thence  might  spring 
A  Neptune’s  palace  for  a  British  King.’ — 

[Knave  of  Diamonds.] 


4  BUBBLE  5  COMPANIES 


89 


gable  1 ;  For  bringing  water  by  a  new  canal  from  St. 
Albans  to  London  ;  For  bringing  water  by  a  new  canal 
from  Richmond  to  London  ;  For  bringing  fresh  water 
to  Liverpool2 ;  York  Buildings  (capital,  £1,200,000) 3 ; 
For  making  salt  water  fresh ;  For  an  engine  to  supply 
fresh  water  for  the  inhabitants  of  the  town  of  Deal 
in  Kent ;  For  a  water  engine  4 ;  Fish  Pool,  for  bring¬ 
ing  fresh  fish  by  sea  to  London  (Sir  Richard  Steele’s 
project).5 

Metal,  Mineral,  and  Mining  Companies  : — For  im¬ 
proving  the  tin  and  lead  mines  of  Cornwall  and  Devon- 

1  River  Douglas . 

4  Since  bubbles  came  in  vogue,  new  arts  are  found 
To  cut  thro’  rocks  and  level  rising  ground, 

That  murm’ring  waters  may  be  made  more  deep 
To  drown  the  knave  and  let  the  fools  asleep.’ — [Ace  of  Spades .] 

2  Liverpool  Fresh  Water. 

4  This  town  does  to  our  western  islands  deal, 

And  serves  ’em  with  malt  liquors  and  with  meal, 

Both  excellently  good  !  Then  how  in  nature 
Can  people  brew  fine  drink  that  want  fresh  water  ?  ’ — 

[Nine  of  Clubs.] 

3  York  Buildings. 

4  You  that  are  blest  with  wealth  by  your  Creator, 

And  want  to  drown  your  money  in  Thames  Water, 

Buy  but  York  Buildings,  and  the  cistern  there 
Will  sink  more  pence  than  any  fool  can  spare.’ — 

[Five  of  Spades.] 

4  Water  Engine. 

4  Come,  all  ye  culls,  my  water  engine  buy 
To  pump  your  flooded  mines  and  coal-pits  dry  ; 

Some  projects  are  all  wind,  but  ours  is  water, 

And  though  at  present  low,  may  rise  herea’ter.’ — 

[Four  of  Hearts.] 

5  Fish  Pool. 

4  How  famous  is  the  man  that  could  contrive 
To  serve  this  glut’nous  town  with  fish  alive  ! 

But  now  we’re  bubbl’d  by  his  fishing  pools, 

And  as  the  men  catch  fish  the  fish  catch  fools.’ — 

[Four  of  Spades.] 


90 


THE  SOUTH  SEA  BUBBLE 


shire  ;  For  smelting  lead  ;  Copper  Miners  of  the  Princi¬ 
pality  of  Wales  1 ;  The  Mine- Ad  venturers  of  England  ; 
For  improving  the  lead  mines  of  Gloucestershire  ;  For 
sinking  pits  and  making  lead  ore  in  Derbyshire  ;  Temple 
Mills  brass- works  2 ;  For  improving  English  copper  and 
brass  3 4 ;  For  improving  the  Jamaica  mines  ;  For  making 
iron  with  pit  coal ;  For  improving  Mr.  Wood’s  iron¬ 
works  and  manufactories  ;  For  erecting  mills  for  the 
milling  of  lead,  and  purchasing  of  lead-mines,  etc. 
(capital,  £2,000,000) ;  For  carrying  on  and  improving 
the  British  Alum  works  ;  For  importing  Swedish  iron  ; 
For  the  wrought  iron  and  steel  manufactures  in  Great 
Britain  (capital,  £4,000,000) ;  For  working  tin  plates, 
or  whited  iron  plates  ;  For  the  transmutation  of  silver 
into  a  malleable  fine  metal ;  For  extracting  silver  from 
lead. 

Oil,  Salt,  and  Sugar  Companies  : — For  making  rape- 
oil  ;  for  making  beech-oil  (Aaron  Hill’s  project) ;  for 
making  oil  from  poppies  ;  for  making  oil  from  sunflower 

1  Welch  Copper. 

4  This  Bubble  for  a  time  may  currant  pass, 

Copper’s  the  title,  but  will  end  in  brass  ; 

Knaves  cry  it  up,  fools  buy,  but  when  it  fails 

The  losing  crowd  will  swear,  ’cot’s  splutt’r  a  nails.’ — 

[Nine  of  Spades .] 

2  Temple  Mills. 

4  By  these  old  mills  strange  wonders  have  been  done, 
Numbers  have  suffer’d,  yet  they  still  work  on  ; 

Then  tell  us  which  have  done  the  greater  ills, 

The  Temple  lawyers,  or  the  Temple  Mills  ?  ’ — 

[King  of  Diamonds.] 

3  English  Copper  and  Brass. 

4  The  headlong  fool  that  wants  to  be  a  swopper 
Of  gold  and  silver  coin  for  English  copper 
May  in  ’Change  Alley  prove  himself  an  ass 
And  give  rich  mettle  for  adult’rate  brass.’ — 

[Nine  of  Hearts.] 


4  BUBBLE  5  COMPANIES 


91 


seed  ;  for  making  oil  from  raddish  seed  1 ;  Salt  Project ; 
Rock  Salt  Project  2 ;  Saltpetre  3 ;  Salt  pans  in  Holy 
Island  (capital,  £2,000,000)  4 ;  For  refining  of  sugar  ; 
For  bleaching  of  coarse  sugar  without  the  use  of  fire 
or  loss  of  substance.5 

Manufacturing  Companies  : — Lute-string  Company 
(capital,  £1,200,000)  6 ;  Sword-blade  Company  ;  For 

1  Raddish  Oil. 

4  Our  oily  project,  with  the  gaping  town 
Will  surely  for  a  time  go  smoothly  down. 

We  sow  and  press,  to  carry  on  the  cheat, 

To  bite  ’Change  Alley  is  not  fraud  but  wit.’ — [ Knave  of  Spades.] 

2  Rock  Salt. 

4  You  that  are  willing  to  preserve  your  meat, 

In  winter  sav’ry  and  in  summer  sweet ; 

Encourage  this  salt  project,  and  your  coin 
Will  turn  to  some  account,  at  least  to  brine.’ — 

[Seven  of  Diamonds .] 

3  Saltpetre. 

4  Come,  all  ye  black  infernal  powder  makers 
And  rocketeers  that  deal  in  squibs  and  crackers, 

Buy  petre  stock — let  me  be  your  adviser — 

’Twill  make  you  (tho’  not  richer)  much  the  wiser.’ — 

[Four  of  Clubs.] 

4  Holy  Island  Salt. 

‘  Here  by  mix’d  elements  of  earth  and  water, 

They  make  a  mud  that  turns  to  salt  herea’ter, 

To  help  the  project  on  among  ’Change  dealers 
May  all  bad  wives  like  Lot’s  become  salt-pillars, 

Since  crowds  of  fools  delight  to  be  salt-sellers.’ — 

[Five  of  Clubs.] 

5  Sugar. 

‘  Fair  tattling  gossips,  you  that  love  to  see 
Fine  sugar  blended  with  expensive  tea, 

Since  you  delight  in  things  both  dear  and  sweet, 

Buy  sugar  shares,  and  you’ll  be  sweetly  bit.’ — [Five  of  Clubs.] 

6  Lute-string. 

*  These  crafty  managers  have  play’d  for  years 
The  world  as  many  tricks  as  dancing  bears  ; 

By  bubbling,  too,  they’ve  broke  their  ancient  rules, 

They  first  made  lute-strings,  but  they  now  make  fools.’ — 

[Ace  of  Clubs.] 


92 


THE  SOUTH  SEA  BUBBLE 


making  fire-engines  ;  For  drying  malt  by  hot  air 1 ; 
For  improving  malt  liquors  (capital,  £4,000,000) ;  For 
raising  hemp  and  flax  in  England2 ;  For  planting  hemp 
and  flax  in  Scotland  and  Ireland,  and  making  sail-cloth, 
cordage,  etc. ;  For  the  manufacture  of  hollands  and 
sail-cloth ;  For  a  sail  and  packing  cloth  manufactory 
in  Ireland 3 ;  For  the  making  of  cambric  and  lawn ; 
For  the  making  of  muslin  ;  For  improving  the  cotton 
and  the  silk-and-cotton  manufactures  ;  For  the  im¬ 
proving  and  the  increasing  of  the  silk  manufactures ; 
For  preparing  tobacco  for  making  snuff 4 ;  For  making 
glass-bottle  and  glass ;  For  making  glass  coaches  and  look¬ 
ing-glasses  (capital,  £2,000,000) ;  For  making  pitch,  tar, 
and  turpentine  ;  For  making  panteles  ;  For  making  the 
Manchester  stuffs  of  thread  and  cotton ;  The  Frame- work 


1  Drying  malt  by  the  air. 

4  Of  all  the  windy  projects  now  in  vogue 
To  fleece  the  fool  and  feed  the  cunning  rogue, 

The  malting  bubble  seems  to  be  most  fair, 

Because  our  maltsters  own  they  work  by  air.’ — 

[Eight  of  Hearts .] 


2  Hemp  and  Flax. 

4  Here  hemp  is  sow’d,  for  stubborn  rogues  to  die  in, 

And  softer  flax,  for  tender  skins  to  lie  in  ; 

But  should  the  useful  project  be  defeated, 

The  knaves  may  prosper,  but  the  fools  are  cheated.’ — 

[Ace  of  Hearts .] 

3  Irish  Sail-cloth. 

4  If  good  St.  Patrick’s  friends  should  raise  a  stock, 

And  make  in  Irish  looms  true  Holland’s  duck, 

Then  shall  this  noble  project  by  my  shoul 
No  longer  be  a  bubble  but  a  bull.’ — [King  of  Clubs.] 


4  Curing  Tobacco  for  Snuff. 

4  Here  slaves  for  snuff  are  sifting  Indian  weed, 

Whilst  their  o’erseer  does  the  riddle  feed, 

The  dust  arising  gives  their  eyes  much  trouble  ; 

To  shew  their  blindness  that  espouse  the  Bubble.’ — 

[Queen  of  Hearts.] 


‘BUBBLE’  COMPANIES 


93 


Knitters 1 ;  For  making  china  and  delft  ware  (capital, 
£1,000,000) ;  For  improving  the  paper  manufactures  in 
Great  Britain ;  For  the  making  of  paste-board,  packing 
paper,  etc. 2 ;  For  making  starch  ;  For  improving  the 
art  of  making  soap  ;  For  making  Joppa  and  Carlisle  soap. 

Trading  Companies  : — For  dealing  in  hogs  3 ;  For 
buying  of  naval  stores,  supplying  the  victualling  and 
paying  the  wages  of  workmen  ;  For  carrying  on  the 
common  trade  of  Great  Britain  ;  For  supplying  London 
with  sea-coal  (capital,  £3,000,000) ;  For  supplying  the 
London  market  with  cattle  ;  For  furnishing  the  cities 
of  London  and  Westminster  and  the  suburbs  with  hay 
and  straw ;  For  trading  in  human  hair ;  For  buying 
and  importing  Flanders  lace ;  For  trading  in  laces, 
hollands,  cambrics,  lawn,  etc.  (capital,  £2,000,000) ; 
For  importing  timber  from  Wales  ;  For  importing  tim¬ 
ber  from  Germany 4 ;  For  trading  to  His  Majesty’s 

1  Stockings. 

4  You  that  delight  to  keep  your  sweaty  feet, 

By  often  changing  stockings  clean  and  sweet, 

Deal  not  in  stocking  shares,  because  I  doubt 
Those  that  buy  most,  e’erlong  will  go  without.’ — 

[Seven  of  Spades.] 

2  Paste-board  Manufactory. 

4  As  empty  saws  flow  from  windy  fools 
So  paste-board  bubbles  rise  from  paper  skulls  ; 

Madness  must  surely  be  the  town’s  disease, 

When  knaves  get  money  by  such  tricks  as  these.’ — 

[Two  of  Clubs.] 

3  Fanning  of  Hogs. 

4  Come,  all  ye  bacon-making  greasy  rogues 
That  want  good  nurses  for  your  meagre  hogs, 

Send  them  to  us,  and  at  a  small  expense 

We’ll  fat  ’em  up,  with  offal,  blood,  and  grains.’ — of  Clubs.] 

4  Exporting  Timber  from  Germany. 

*  You  that  are  rich  and  hasty  to  be  poor, 

But  timber  export  from  the  German  shore  ; 

For  gallouses,  built  up  of  foreign  wood, 

If  rightly  us’d,  may  do  ’Change  Alley  good.’ — [Ten  of  Hearts.] 


94 


THE  SOUTH  SEA  BUBBLE 


German  Dominions  ;  For  trading  to  Harburg  (capital, 
£1,500,000) 1 ;  For  the  exportation  of  our  woollen 
manufactures,  and  the  importation  of  copper,  brass, 
and  iron  ;  For  importing  of  Swedish  iron  ;  For  trading 
to  Barbary  (Jezreel  Jones’s  project) ;  For  trading  in 
Newcastle  coal 2 ;  For  trading  in,  and  improving,  cer¬ 
tain  commodities  of  the  produce  of  this  kingdom  (capital, 
£3,000,000). 

Companies  Trading  to  America,  etc.  : — For  a  settle¬ 
ment  on  the  island  of  Santa  Cruz ;  For  effectually 
settling  the  islands  of  Blanca  and  Sal  Tortugaz  ;  For 
carrying  on  a  trade  to  the  river  Orinoko  ;  For  trading  to 
the  Golden  Islands  (Sir  Robert  Montgomery’s  project) ; 
For  settling  the  Bahama  Islands 3 ;  For  settling  colonies 
in  North  America4;  For  importing  pitch  and  tar  and 

1  Trade  to  II  arbor  ough. 

4  You  that  delight  to  take  up  foreign  linen 
At  Harb’rough  made,  a  little  town  in  Bremen, 

Encourage  trade  abroad  for  time  to  come, 

And  like  kind  fools,  neglect  your  own  at  home.’ — 

[Three  of  Clubs.] 

2  Coal  Trade  from  Newcastle. 

4  Some  deal  in  water,  some  in  wind  like  fools, 

Others  in  wood,  but  we  alone  in  coals  ; 

From  suchlike  projects  the  declining  nation 

May  justly  fear  a  fatal  inflammation.’ — [Three  of  Hearts. ] 

3  Bahama  Islands. 

4  Rare  fruitful  isles,  where  not  an  ass  can  find 
A  verdant  tuft  or  thistle  to  his  mind  ! 

How  now  must  those  poor  silly  asses  fare 
That  leave  this  native  land  to  settle  there  ?  ’ — 

[Five  of  Diamonds.] 

4  Settling  Colonies  in  Accadia ,  North  America. 

4  He  that  is  rich,  and  wants  to  fool  away 

A  sporting  sum  in  North  America, 

Let  him  subscribe  himself  a  headlong  sharer, 

And  asses’  ears  shall  honour  him  a  bearer.’ — 

[Eight  of  Diamonds.] 


4  BUBBLE  ’  COMPANIES 


95 


other  naval  stores  from  Nova  Scotia  and  America ; 
For  importing  walnut-trees  from  Virginia  (capital, 
£2,000,000) ;  For  importing  of  hemp  and  flax  from 
Pennsylvania 1 ;  For  importing  beaver  fur  (capital, 
£2,000,000) ;  For  importing  of  tobacco,  and  exporting 
it  again  to  Sweden,  etc.  (capital,  £4,000,000). 

Miscellaneous  Companies  : — For  planting  mulberry- 
trees  and  breeding  silk-worms  in  Chelsea  Park  (Richard 
Manningham’s  project) ;  For  providing  for  employing 
all  the  poor  in  Great  Britain  (Lawrence  Braddon’s  pro¬ 
ject)  2 ;  For  the  encouragement  of  the  industrious  ; 
For  recovering  seamen’s  wages  ;  For  taking  up  ballast ; 
For  entering  a  loading  goods  at  the  Customs  House  and 
negotiating  other  business  for  merchants  ;  For  a  grand 
dispensary  (capital,  £3,000,000) ;  For  the  furnishing  of 
funerals  in  any  part  of  Great  Britain 3 ;  The  Charitable 
Corporation  for  Pledges  ;  Wrecks  to  be  fished  for  on 

1  Pennsylvania  Company. 

4  Come  all  ye  saints  that  would  for  little  buy 
Great  tracts  of  land  and  care  not  where  they  lie, 

Deal  with  your  Quaking  friends,  they’re  men  of  light, 

The  spirit  hates  deceit  and  scorns  to  bite.’ — 

[Nine  of  Diamonds .] 

2  Lawrence  Braddon  (d.  1724),  politician,  author  of  4  The 
Miseries  of  the  Poor  are  a  National  Sin,  Shame,  and  Danger  ’ 
(1717). 

Providing  for ,  and  employing  all  the  poor  in  Great  Britain. 

4  The  poor  when  manag’d  and  employ’d  in  trade, 

Are  to  the  public  welfare  useful  made, 

But  if  kept  idle  from  their  vices  spring 

\y - s  for  the  stews  and  soldiers  for  the  King.’ — 

[Ten  of  Spades.] 

3  Furnishing  of  Funerals  to  all  parts  of  Great  Britain. 

4  Come  all  ye  sickly  mortals,  die  apace, 

And  solemn  pomps  your  funerals  shall  grace, 

Old  rusty  hackneys  shall  attend  each  hearse, 

And  scarecrows  in  black  gowns  complete  the  farce.’ — 

[Queen  of  Diamonds.] 


96 


THE  SOUTH  SEA  BUBBLE 


the  Irish  Coast ;  For  a  more  inoffensive  method  of 
emptying  or  cleansing  necessary  houses ;  Puckle’s 
machine  gun 1 ;  For  employing  artificers  and  furnishing 
merchants  and  others  with  watches  ;  For  buying  and 
fitting  out  ships  to  suppress  pirates  ;  Globe  Permits  ; 
For  the  importing  of  jackasses  from  Spain ;  For 
a  wheel  for  perpetual  motion  (capital,  £1,000,000) ; 
For  an  undertaking  which  shall  in  due  course  be 
revealed. 

It  was  enough  for  any  man  to  take  a  room  near 
’Change  Alley,  and  advertise  a  4  bubble  ’  in  the  news¬ 
papers,  for  people  to  flock  to  him  and  beg  him  to  take 
their  money.  4  The  hurry  of  our  stock- jobbing  bubblers 
especially  has  been  so  great  this  week  that  it  has  even 
exceeded  all  that  was  ever  known  before,’  said  a  writer 
in  the  London  Journal ,  June  11.  4  The  subscriptions 

are  innumerable  ;  and  so  eager  all  sorts  of  people  have 
been  to  engage  in  them,  however  improbable  or  ridiculous 
soever  they  have  appeared,  that  there  has  been  nothing 
but  running  about  from  one  coffee-house  to  another,  and 
from  one  tavern  to  another,  to  subscribe,  without  ex¬ 
amining  what  the  proposals  were.  The  general  cry  has 
been  44  For  G - ’s  sake  let  us  but  subscribe  to  some¬ 

thing,  wre  do  not  care  what  it  is  !  ”  So  that,  in  short, 
many  have  taken  them  at  their  wrords,  and  entered 
them  adventurers  in  some  of  the  grossest  cheats  and 
improbable  undertakings  that  ever  the  wTorld  heard  of ; 
and  yet,  of  all  these,  the  projectors  have  got  money,  and 

1  Puckle's  Machine. 

‘  A  rare  invention  to  destroy  the  crowd 
Of  fools  at  home  instead  of  foes  abroad  ; 

Fear  not,  my  friends,  this  terrible  machine, 

They’re  only  wounded  that  have  shares  therein.’ — 

[Eight  of  Spades.] 


1  BUBBLE  5  COMPANIES 


97 


have  now  their  subscriptions  full  as  soon  as  desired.5 
Incredible  as  it  may  sound,  a  thousand  persons  in  one 
morning  paid  two  guineas  each,  as  a  first  instalment  for 
shares  in  a  company  4  for  carrying  on  an  undertaking 
of  great  importance,  but  nobody  to  know  what  it  is.’ 
No  reader  will  be  surprised  to  hear  that  the  projector 
of  this  enterprise  went  off  in  the  afternoon  with  the 
money,  and  never  reappeared  upon  the  scene. 

Some  of  the  new  companies,  controlled  by  wiser 
heads  than  the  rest,  desired  to  secure  authorisation  by 
the  Legislation  for  their  incorporation,  and  amongst 
these  were  the  Royal  Exchange  and  London  Assurance 
Companies,  of  which,  respectively,  Lord  Onslow  1  and 
Lord  Chetwynd 2  were  the  Governors.  These  companies 
endeavoured  to  enlist  the  support  of  the  House  of 
Commons,  but  in  this  they  failed.  As  a  last  resource, 
the  managers,  being  aware  that  the  Civil  List  was  in 
arrears,  approached  the  Government  with  an  offer  of 
£600,000  towards  the  discharge  of  the  debt,  on  condition 
that  the  sanction  of  Parliament  for  the  establishment 
of  these  institutions  was  obtained,  and  Royal  Charters 
granted.  4  These  bubbles  Walpole  and  Craggs  had  en¬ 
gaged  in,  and  they  would  hear  no  other  proposals,  though 
others  offered  double  what  they  did,’  Lady  Cowper 
wrote  in  her  4  Diary  ’  on  May  4  ;  on  which  day  Aislabie 
delivered  to  the  House  of  Commons  a  Message  from  the 
King :  4  His  Majesty  having  received  several  petitions 
from  great  numbers  of  the  most  eminent  merchants  of 

1  Thomas  Onslow,  second  Baron  Onslow  of  Onslow  (1682  ?- 
1740). 

2  Walter  Chetwynd,  first  Viscount  Chetwynd  of  Bearhaven, 
co.  Kerry,  M.P.  for  Stafford,  1702-1711,  1712-1722,  1725- 
1734  ;  Master  of  the  Buckliounds,  1705-1711  ;  Ranger  of 
St.  James’s  Park,  1714-1727  ;  created  an  Irish  peer,  1717. 

H 


98 


THE  SOUTH  SEA  BUBBLE 


the  City  of  London,  humbly  praying  that  he  would  be 
graciously  pleased  to  grant  them  his  Letters  Patents 
for  erecting  corporations  to  insure  ships  and  merchan¬ 
dise  ;  and  the  said  merchants  having  offered  to  advance 
and  pay  a  considerable  sum  of  money  for  his  Majesty’s 
use,  in  case  they  may  obtain  Letters  Patents  accordingly ; 
his  Majesty  being  of  opinion  that  erecting  two  such 
corporations  exclusive  only  of  all  other  corporations 
and  societies  for  insuring  of  ships  and  merchandise,  under 
proper  restrictions  and  regulations,  may  be  of  great 
advantage  and  security  to  the  trade  and  commerce  of 
the  kingdom,  is  willing  and  desirous  to  be  strengthened 
by  the  advice  and  assistance  of  this  House  in  matters 
of  this  nature  and  importance.  He  therefore  hopes  for 
their  ready  concurrence  to  secure  and  confirm  the 
privileges  his  Majesty  shall  grant  to  such  corporations, 
and  to  enable  him  to  discharge  the  debts  of  his  civil 
government,  without  burdening  his  people  with  any 
new  aid  or  supply.’  A  Bill  was  forthwith  introduced, 
sanctioning  the  establishment  of  these  concerns,  and, 
while  not  interfering  with  the  right  of  private  persons 
to  practise  insurance  on  ships  and  merchandise  as 
formerly,  made  such  business  exclusive  to  them  as  cor¬ 
porations,  the  South  Sea  and  East  India  Companies 
excepted,  which  might  still  continue  to  advance  money 
on  bottomry. 

To  this  Bill  was  attached  a  clause  4  for  restraining 
several  extravagant  and  unwarrantable  practices.’  This 
caused  widespread  dismay  in  certain  circles,  for  it  struck 
at  the  very  vitals  of  the  4  bubbles,’  and  made  it  very 
clear  that  their  days  were  numbered.  The  general 
public  in  those  days  knew  little  of  what  was  being  done 
in  Parliament,  and  promoters  were  thus  able  to  take 
advantage  of  the  interval  between  the  introduction  of 


1  BUBBLE 5  COMPANIES 


99 


the  Bill  and  its  becoming  law.  c  The  new  stocks  erected 
in  the  City  are  numberless,5  Thomas  Harley  wrote  to 
Lord  Oxford,  May  31,  1720  ;  ‘  but  many  of  them  are 
dying  like  flies  with  a  blast  of  cold  wind  upon  the  Bill 
depending  to  establish  some  and  sink  the  rest.  When 
that  Bill  passes,  the  Parliament  is  to  rise,  and,  soon 
after,  the  King  goes  to  Germany.5  1  The  Royal  Assent 
was  given  to  the  Bill 1  2  on  June  11  ;  and  on  that  day 
the  following  Proclamation  was  issued  by  His  Majesty 
in  Council : — 

*  George  R. 

4  Whereas  in  and  by  an  Act  made  in  the  last  Session  of  Parlia¬ 
ment  [intituled,  An  Act  for  the  better  securing  certain  powers 
and  privileges  intended  to  be  granted  by  his  Majesty  by  two 
Charters  for  Assurance  of  Ships  and  Merchandise  at  sea,  and 
for  lending  money  upon  bottomry,  and  for  restraining  several 
extravagant  and  unwarrantable  practices  therein  mentioned] 
reciting,  That  several  projects  of  different  kinds  have,  since 
the  twenty-fourth  day  of  June,  1718,  been  publicly  contrived 
and  practised  within  the  City  of  London,  and  other  parts  of 
this  kingdom,  as  also  in  Ireland,  and  other  our  dominions,  which 
manifestly  tend  to  the  common  grievance  of  our  subjects  in 
their  trade,  and  other  their  affairs  ;  and  the  persons  contriving 
or  attempting  such  mischievous  projects,  under  false  pretences 
of  public  good,  had  presumed  to  open  books  for  public  sub¬ 
scriptions,  and  draw  in  unwary  persons  to  subscribe  therein 
towards  raising  great  sums  of  money,  whereupon  the  subscribers 
or  claimants  under  them,  paid  small  proportions  thereof  ;  which 
mischievous  projects  related  to  several  fisheries  and  other 
affairs,  wherein  the  trade  and  welfare  of  our  subjects  were 
concurred  ;  and  reciting,  that  in  many  cases,  the  said  under¬ 
takers  or  subscribers  had,  since  the  said  twenty-fourth  day  of 
June,  presumed  to  act  as  if  they  were  corporate  bodies,  and  had 
pretended  to  make  their  shares  in  stocks  transferable  without 
legal  authority  ;  and  in  some  cases  the  undertakers  and  sub¬ 
scribers  had  acted,  or  pretended  to  act,  under  some  charter 
or  charters  formerly  granted  for  some  particular  purposes,  but 


1  Portland  MSS.,  V.,  597. 

2  Anno  6  Georgii  I.  18. 


100 


THE  SOUTH  SEA  BUBBLE 


had  used  the  same  for  raising  joint  stocks,  and  for  making 
pretended  transfers  or  assignments  for  their  own  private  lucre  ; 
and  in  some  cases  the  undertakers  and  subscribers  had  acted 
under  some  obsolete  charter  or  charters,  although  the  same 
became  void  or  voidable  by  nonuser  or  abuser,  or  for  want  of 
making  lawful  elections,  which  were  necessary  for  the  con¬ 
tinuance  thereof ;  and  many  other  unwarrantable  practices 
had  been,  and  might  thereafter  be,  contrived,  to  the  ruin  of 
any  of  our  good  subjects,  if  a  timely  remedy  were  not  provided  ; 
and  reciting  further  that  it  was  become  absolutely  necessary, 
that  all  public  undertakings  and  attempts,  tending  to  the 
common  grievance  and  prejudice  of  our  subjects  in  their  trade, 
or  other  lawful  affairs,  should  be  effectually  suppressed  by 
suitable  and  adequate  punishments  for  that  purpose  to  be 
established  : 

4  Therefore,  for  suppressing  such  mischievous  and  dangerous 
undertakings  and  attempts,  and  preventing  the  like  for  the 
future,  it  is  in  and  by  the  said  Act  enabled,  that  from  and  after 
the  twenty- fourth  day  of  June,  1720,  all  and  every  the  under¬ 
takings  and  attempts  described,  as  aforesaid,  and  all  other 
public  undertakings  and  attempts,  tending  to  the  common 
grievance,  prejudice,  and  inconvenience  of  our  subjects  in 
their  trade,  commerce,  or  other  lawful  affairs,  and  all  public 
subscriptions,  receipts,  payments,  assignments,  transfers,  pre¬ 
tended  assignments  and  transfers,  and  all  other  matters  and 
things  whatsoever,  for  furthering,  countenancing,  or  proceeding 
in  any  such  undertaking  or  attempt ;  and  more  particularly 
the  acting,  or  presuming  to  act,  as  a  corporate  body  or  bodies, 
the  raising,  or  pretending  to  raise,  transferable  stock  or  stocks, 
without  legal  authority,  either  by  Act  of  Parliament  or  any 
Charter  from  the  Crown,  to  warrant  such  acting  as  a  body 
corporate,  or  raise  such  transferable  stock  or  stocks,  or  to 
transfer  shares  therein  ;  and  all  acting,  or  pretending  to  act, 
under  any  charter  granted  from  the  Crown  for  particular  or 
special  purposes  therein  expressed,  by  persons  who  should  use, 
or  endeavour  to  use,  the  same  charter  for  raising  a  capital 
stock,  or  for  making  transfers,  or  assignments,  or  pretended 
transfers  or  assignments  of  such  stock,  not  intended  or  designed 
by  such  charter  to  be  raised  or  transferred  ;  and  all  acting,  or 
pretending  to  act,  under  any  obsolete  charter,  become  void 
and  voidable  by  nonuser  or  abuser,  or  for  want  of  making 
lawful  elections,  which  were  necessary  to  continue  the  corpora¬ 
tion  thereby  intended,  should  (as  to  all  or  any  such  acts,  matters 
and  things,  as  should  be  done,  attempted  and  proceeded  upon, 


‘BUBBLE’  COMPANIES 


101 


after  the  said  twenty-fourth  day  of  June,  1720)  for  ever  be 
deemed  to  be  illegal  and  void,  and  should  not  be  practised  or 
in  any  wise  put  in  execution. 

*  And  it  is  in  and  by  the  said  Act  further  enacted,  That 
from  and  after  the  said  twenty-fourth  day  of  June,  1720,  all 
such  unlawful  undertakings  and  attempts,  so  tending  to  the 
common  grievance,  prejudice,  and  inconvenience  of  our  sub¬ 
jects  in  their  trade,  commerce,  and  other  lawful  affairs  ; 
and  the  making  or  taking  any  subscriptions  for  that  purpose, 
the  receiving  or  paying  any  money  upon  such  subscriptions, 
the  making  or  accepting  of  any  assignment  or  transfer  of  any 
share  or  shares  upon  any  such  subscription,  and  all  and  every 
other  matter  or  thing  whatsoever,  for  furthering,  contenancing, 
or  proceeding  in  any  such  unlawful  undertaking  or  attempt  ; 
and  more  particularly  the  presuming  or  pretending  to  act  as  a 
corporate  body,  or  to  raise  or  transfer  stock  or  stocks,  or  to 
make  transfers  or  assignments  of  any  share  or  shares  therein, 
without  such  legal  authority,  as  aforesaid  ;  and  all  acting,  or 
pretending  to  act,  under  any  charter  formerly  granted  from  the 
Crown  for  any  special  purposes,  by  persons  making,  or  endea¬ 
vouring  to  make,  use  of  such  charter  for  any  such  other  purpose 
not  thereby  intended  ;  and  all  acting,  or  pretending  to  act, 
under  such  obsolete  charter  as  is  before  described,  and  every 
of  them  (as  to  all  or  any  such  acts,  matters,  or  things,  as 
should  be  so  done,  attempted,  or  proceeded  upon  after  the  said 
twenty-fourth  day  of  June,  1720)  should  be  deemed  to  be  a 
public  nuisance  and  nuisances  ;  and  the  same  and  all  causes, 
matters,  and  things  relating  to,  and  every  of  them,  should  for 
ever  thereafter  be  tried  and  determined  as  common  nuisances  ; 
and  all  offenders  therein,  being  thereof  formally  convicted 
upon  information  or  judgment,  in  any  of  our  Courts  of  Record 
at  Westminster,  or  in  Edinburgh,  or  in  Dublin,  should  be 
liable  to  such  fines,  penalties,  and  punishments,  whereunto 
persons  convicted  for  common  and  public  nuisances,  are  by 
any  of  the  laws  and  statutes  of  this  realm  subject  and  liable  ; 
and  moreover  should  incur  and  sustain  such  further  pains, 
penalties,  and  forfeitures  as  were  ordained  and  provided  by 
the  Statute  of  Provision  and  Preminure,  made  in  the  sixteenth 
year  of  the  reign  of  King  Richard  the  Second. 

‘  And  it  is  in  and  by  the  said  Act  further  enacted,  That  if 
any  merchant  or  trader,  at  any  time  after  the  said  twenty- 
fourth  day  of  June,  1720,  should  suffer  any  particular  damage 
in  his,  her,  or  their  trade,  commerce,  or  other  lawful  affairs, 
by  occasion  or  means  of  any  undertaking  or  attempt,  matter, 


102 


THE  SOUTH  SEA  BUBBLE 


or  thing,  by  the  said  Act  declared  to  be  unlawful,  as  aforesaid, 
and  should  sue  to  be  relieved  therein,  that  then,  and  in  every 
such  case,  such  merchant  or  trader  should  or  might  have  his 
and  their  remedy  for  the  same  by  an  action  or  actions  to  be 
grounded  upon  the  said  statute,  against  the  persons,  societies, 
or  partnerships,  or  any  of  them,  who,  contrary  to  the  said  Act, 
should  be  engaged  or  interested  in  any  such  unlawful  under¬ 
taking  or  attempt ;  and  in  every  such  action  the  plaintiff 
should  recover  treble  damages  with  full  costs  of  suit. 

4  And  it  is  in  and  by  the  same  Act  further  enacted,  That  if 
any  broker,  or  person  acting  as  a  broker,  for  himself,  or  on 
behalf  of  any  others,  at  any  time  or  times,  after  the  said  twenty- 
fourth  day  of  June,  1720,  should  bargain,  sell,  buy,  or  purchase,  or 
contract  or  agree  for  the  bargaining,  selling,  buying,  or  purchas¬ 
ing  of  any  share  or  interest  of  any  of  the  undertakings  by  the 
said  Act  declared  to  be  unlawful,  or  in  any  stock,  or  pretended 
stock,  of  such  undertakers,  that  then,  and  in  every  such  case, 
every  such  broker,  or  person  acting  as  such,  should  not  only 
be  disabled  and  rendered  incapable  to  be  or  act  as  a  broker 
for  the  future,  but  should  also  lose  and  forfeit  the  sum  of  five 
hundred  pounds,  to  be  recovered,  one  moiety  thereof  to  the 
use  of  us,  our  heirs  and  successors,  and  the  other  moiety 
thereof  to  the  use  of  any  person  or  persons  who  should  inform 
or  sue  for  the  same  in  any  of  our  said  Courts  of  Records  with 
full  costs  of  suit ;  as  by  the  said  Act,  amongst  other  clauses 
and  things  therein  contained,  more  at  large  may  appear. 

‘  And  whereas  we  are  deeply  sensible  of  the  many  mischievous 
consequences  which  must  inevitably  ensue  from  the  unwar¬ 
rantable  practices  in  the  said  Act  mentioned,  by  ensnaring  and 
defrauding  unwary  persons  to  their  utter  impoverishment  and 
ruin,  by  taking  off  the  minds  of  many  of  our  subjects  from 
attending  their  lawTful  employments,  and  by  introducing  a 
general  neglect  of  trade  and  commerce,  upon  which  the  wealth 
and  prosperity  of  our  kingdom  so  much  depend,  the  promoting 
and  encouragement  whereof  we  have  always  at  heart,  and  we 
being  determined  for  the  reasons  aforesaid,  to  cause  the  said 
Act  to  be  put  effectually  into  execution  ;  but  being  willing  and 
desirous  that  none  of  our  loving  subjects  should  be  ignorant 
of  the  same,  nor  unwarily  subject  themselves  to  the  forfeiture 
of  their  lands  and  tenements,  goods  and  chattels,  and  imprison¬ 
ment  of  their  persons,  by  incurring  the  penalty  of  preminure 
thereby  justly  inflicted,  have,  by  and  with  the  advice  of  our 
Privy  Council,  thought  fit  to  issue  this  our  Royal  Proclamation  ; 
and  we  do  hereby  strictly  charge  and  command,  that  no  person 


4  RUBBLE  ’  COMPANIES 


103 


or  persons  whatsoever,  bodies  public  or  corporate,  do  presume 
to  commit  or  attempt  any  act,  matter,  or  thing  whatsoever, 
contrary  to  the  provisions  of  the  said  Act,  and  the  true  intent 
and  meaning  thereof :  and  that  the  said  Act  of  Parliament  be 
in  every  particular  punctually  observed  and  kept,  upon  pain 
of  the  several  penalties  by  the  said  Act  inflicted  upon  offenders 
against  the  same. 

4  And  we  do  hereby  declare,  that  we  will  cause  the  said  Act 
effectually  to  be  put  in  execution,  and  that  all  assistance  and 
due  encouragement  shall  be  given  to  all  persons  who  shall 
discover  and  detect  any  offender  or  offenders  against  the  same. 

4  And  we  do  hereby  strictly  charge  and  command  all  mayors, 
sheriffs,  justices  of  the  peace,  and  all  other  our  officers  and 
ministers  and  all  other  our  subjects,  whom  it  may  concern,  to 
be  very  vigilant  and  strict  in  the  discovery  and  effectual  pro¬ 
secution  of  all  persons  who  shall  in  any  wise  offend  in  the 
premisses  ;  and  that  they  do  use  their  utmost  diligence  in 
causing  the  said  Act  to  be  put  in  execution  upon  pain  of  incur¬ 
ring  our  highest  displeasure. 

4  Given  at  our  Palace  of  St.  James’s,  the  eleventh  day  of 
June,  1720,  and  in  the  sixth  year  of  our  reign.’ 

The  majority  of  the  4  bubbles  5  raised  no  protest, 
simply  because  it  was  not  worth  while,  for  their  shares 
had  fallen  so  low  upon  the  issue  of  the  Proclamation 
that  even  the  most  sanguine  promoter  must  have  realised 
that  the  game  was  up  for  good  and  all.  Indeed,  the 
promoters,  having  made  their  fortunes,  asked  for  nothing 
better  than  to  be  allowed  to  retire  with  their  ill-gotten 
gains  into  decent  obscurity.  4  The  destruction  of  the 
Bubbles  has  been  a  very  heavy  blow  to  many  families 
here,  and  some  are  entirely  ruined  by  them,’  so  runs 
a  paragraph  in  the  London  Journal ,  July  2.  4  There 

appeared  the  utmost  consternation  in  Exchange  Alley 
the  day  the  Act  for  suppressing  them  took  place,  which, 
because  of  the  confusion  and  terror  it  struck  among 
those  brethren  in  iniquity,  they  called  The  Day  of 
Judgment.  It  may  be  well  indeed  with  many  of  them, 
if  no  future  inquisition  be  made  into  their  conduct  in 


104 


THE  SOUTH  SEA  BUBBLE 


this  matter,  though,  if  so,  they  would  not  wholly  escape  ; 
for  many  of  those  who  had  been  the  most  assiduous  in 
drawing  other  poor  wretches  in  to  their  ruin  have,  besides 
their  wealth,  acquired  an  infamy  they  can  never  wipe 
off ;  and  as  the  rage  of  those  who  have  drunk  deep  of 
the  delusion  is  at  this  time  pretty  great,  the  others  do 
not  seem  fond  of  appearing  too  much  in  public  for  the 
present ;  they  being  followed  with  the  reproaches, 
threats,  and  bitterest  “curses  of  the  poor  people  they 
have  delivered  to  their  destruction.  So  that  if  all  of 
them  escape  the  resentment  of  the  populace,  it  must 
be  more  owing  to  the  care  of  the  magistracy  than  the 
will  or  desperation  of  the  injured.’ 

The  majority  of  the  promoters  having  disappeared 
almost  as  if  by  magic,  the  offices  of  the  companies  were 
closed,  the  staffs  dispersed,  and  ’Change  Alley  was 
thronged  only  by  distressed  shareholders.  How  great 
was  the  ruin  may  partly  be  gathered  from  the  following 
table  : — 


Companies. 

Original  Money 
paid  or  due. 

Highest  Price  sold 
for  in  1720. 

Insurance  against  Fire  . 

2s.  6 d.  per  share 

£8  per  share 

Westley’s  auctions  . 

£7  109. 

£100  ,, 

Greenland  whale  fishery 
(Sir  John  Lambert’s) 
National  permits  for  a 
fishery 

10s. 

70s.  per  cent. 

£60  each  permit 
before  any 
money  paid 
down 

Orkney  Fisheries 

Sir  Richard  Steele’s  Fish 

Pool 

£25 

£250  per  share 
£160  per  share 
before  any 
money  was 

paid 

For  bringing  fresh  water 
to  Liverpool 

£10 

£20  per  share 

4  BUBBLE  ’  COMPANIES 


105 


Companies. 

Original  Money 
paid  or  due. 

Highest  Price  sold 
for  in  1720. 

For  making  the  river 
Douglas  navigable 

£5  per  share 

£70  per  share 

For  building  ships  to  let 
for  freight  .... 

£1 

£15 

Salt-pans  in  Holy  Island 

£5 

£15 

Temple  Mills  brass- works 

£10 

£250 

Globe  Permits 

— 

£70 

For  settling  the  Bahama 
Islands . 

£3  „ 

£40 

For  raising  hemp  and 
flax  in  England  . 

25.  6d.  ,, 

£1  10s. 

For  importing  hemp  and 
flax  from  Pennsyl¬ 
vania  ..... 

£2  105. 

£28 

For  purchasing  lands  in 
Great  Britain  (Sir  John 
Lambert’s) 

£5 

£20 

For  trading  to  Harburg  . 

£15  per  cent. 

£120  per  cent. 

Puckle’ s  Machine  Gun  . 

£4  per  share 

£8  per  share 

Some  few  4  bubbles,’  however,  still  defied  the  Act 
and  ignored  the  Proclamation,  and  some,  by  pleading 
obsolete  charters,  endeavoured  to  exclude  themselves 
from  its  operation.  One  of  these  was  the  Corporation 
of  the  Copper  Miners  of  England,  whose  shares,  on  which 
£5  had  been  paid,  at  one  time  sold  at  £105  ;  and  this 
Company  now  endeavoured  successfully  to  secure  Royal 
support.  4  There  is  a  new  subscription  going  on  for 
what  they  call  smelting  of  copper,  which  I  take  to  be  the 
refining  of  it,’  James  Craggs  the  younger  wrote  to  Lord 
Stanhope,  July  8.  4  They  pretend  a  patent,  which 

excepts  them  from  the  bubbles,  destroyed  by  the  last 
Act  of  Parliament ;  and  have  the  opinions  of  some 
eminent  lawyers,  that,  notwithstanding  that  law,  they 
may  act  legally  under  it.  My  Lord  Westmorland  was 
at  the  head  of  this  undertaking  ;  but  his  Lordship  and 


106 


THE  SOUTH  SEA  BUBBLE 


the  persons  engaged  with  him  having  represented  to 
His  Royal  Highness  (the  Prince  of  Wales)  the  usefulness 
of  it,  he  has  done  them  the  honour  to  accept  of  being 
their  governor.’  1  Four  days  later  Craggs  wrote  again 
to  Stanhope  :  4  The  Speaker  and  Mr.  Walpole  could 
not  dissuade  the  Prince  (of  Wales)  from  being  Governor 
of  this  copper  mining  company,  tho’  they  told  him 
he  would  be  prosecuted,  mentioned  in  Parliament,  and 
cried  in  the  Alley,  upon  the  foot  of  Onslow’s  insurance,2 
Chetwynd’s  bubble,3  Prince  of  Wales’s  bubble,  etc. 
He  has  already  got  £40,000  by  it.’ 4 

A  further  step  against  the  unauthorised  companies  was 
taken  on  July  14,  when  the  following  order  was  issued : — 

4  Their  Excellencies  the  Lords  Justices  in  Council,  taking  into 
consideration  the  many  inconveniences  arising  to  the  public 
from  several  projects  set  on  foot  for  raising  of  joint  stocks  for 
various  purposes,  and  that  a  great  many  of  His  Majesty’s 
subjects  have  been  drawn  in  to  part  with  their  money  on  pre¬ 
tence  of  assurances  that  their  petitions  for  patents  and  charters 
to  enable  them  to  carry  on  the  same  would  be  granted  :  to 
prevent  such  impositions  their  Excellencies  this  day  ordered 
the  said  several  petitions,  together  with  such  reports  from  the 
Board  of  Trade  and  from  His  Majesty’s  Attorney  and  Solicitor- 
General  as  had  been  obtained  thereon,  to  be  laid  before  them, 
and  after  mature  consideration  thereof,  were  pleased,  by  advice 
of  His  Majesty’s  Privy  Council,  to  order  that  the  said  petitions 
be  dismissed.  Which  are  as  followeth  : 

‘  Petition  of  several  persons,  praying  letters  patents  for 
carrying  on  a  fishing  trade,  by  the  name  of  the  Grand  Fishery 
of  Great  Britain. 

4  Petition  of  the  Company  of  the  Royal  Fishery  of  England, 
praying  letters  patents  for  such  further  powers  as  will  effectually 
contribute  to  carry  on  the  said  fishery. 

4  Petition  of  George  James,  in  behalf  of  himself  and  divers 
persons  of  distinction  concerned  in  a  National  Fishery,  praying 

1  Coxe  :  Memoirs  of  Sir  Robert  Walpole,  II.,  187. 

2  Royal  Exchange  Company. 

3  London  Assurance  Company. 

4  Coxe  :  Memoirs  of  Sir  Robert  Walpole ,  II.,  188. 


‘BUBBLE’  COMPANIES 


107 


letters  patents  of  incorporation  to  enable  them  to  carry  on  the 
same. 

4  Petition  of  several  merchants,  traders,  and  others,  whose 
names  are  thereunto  subscribed,  praying  to  be  incorporated 
for  reviving  and  carrying  on  a  Whale  Fishery  to  Greenland 
and  elsewhere. 

4  Petition  of  Sir  John  Lambert,  and  others  thereto  sub¬ 
scribing  on  behalf  of  themselves  and  a  great  number  of  mer¬ 
chants,  praying  to  be  incorporated  for  carrying  on  a  Greenland 
Trade,  and  particularly  a  Whale  Fishery  in  Davies  Straits. 

4  Another  petition  for  a  Greenland  Trade. 

4  Petition  of  several  merchants,  gentlemen,  and  citizens 
thereto  subscribing,  praying  to  be  incorporated  for  buying  and 
building  up  ships  to  let  for  freight. 

4  Petition  of  Samuel  Antrim  and  others,  praying  letters 
patents  for  sowing  hemp  and  flax. 

4  Petition  of  several  merchants,  masters  of  ships,  sail-makers, 
and  manufacturers  of  sail-cloth,  praying  a  charter  for  an 
incorporation  to  enable  them  to  carry  on  and  promote  the  said 
manufactory  by  a  joint  stock. 

4  Petition  of  Thomas  Boyd,  and  several  hundred  merchants, 
owners  and  masters  of  ships,  sail-makers,  weavers,  and  other 
traders,  praying  a  charter  of  incorporation,  empowering  them 
to  borrow  money  for  purchasing  lands  in  order  to  the  manu¬ 
facturing  sail-cloth  and  fine  holland. 

4  Petition  on  behalf  of  several  persons  intrusted  in  a  patent 
granted  by  the  late  King  William  and  Queen  Mary  for  the 
making  of  linen  and  sail-cloth,  praying  that  no  charter  may  be 
granted  to  any  persons  whatsoever  for  making  sail-cloth,  but 
that  the  privilege  now  enjoyed  by  them  may  be  confirmed,  and 
likewise  an  additional  power  to  carry  on  the  cotton  and  cotton- 
silk  manufactures. 

4  Petition  of  several  citizens,  merchants  and  traders  in  London 
and  other  subscribers  to  a  British  stock  for  a  General  Insurance 
from  Fire  in  any  part  of  England,  praying  to  be  incorporated 
for  carrying  on  the  said  undertaking. 

4  Petition  of  several  of  His  Majesty’s  loyal  subjects  of  the 
City  of  London  and  other  parts  of  Great  Britain  thereto  sub¬ 
scribing,  praying  to  be  incorporated  for  carrying  on  a  General 
Insurance  from  Losses  by  Fire  within  the  Kingdom  of  England. 

4  Petition  of  Thomas  Burges  and  other  His  Majesty’s  sub¬ 
jects  thereto  subscribing,  in  behalf  of  themselves  and  others, 
subscribers  to  a  fund  of  one  million  two  hundred  thousand 
pounds,  for  carrying  on  a  trade  to  His  Majesty’s  German 


108 


THE  SOUTH  SEA  BUBBLE 


dominions,  praying  to  be  incorporated  by  the  name  of  the 
Harburg  Company.  - 

4  Petition  of  Edward  Jones,  a  dealer  in  timber,  on  behalf  of 
himself  and  others,  praying  to  be  incorporated  for  the  importa¬ 
tion  of  timber  from  Germany. 

4  Petition  of  several  merchants  of  London  and  others,  praying 
a  charter  of  incorporation  for  carrying  on  a  Salt  Work. 

4  Petition  of  Captain  Macphaedris,  of  London,  merchant,  on 
behalf  of  himself  and  several  merchants,  clothiers,  hatters, 
dyers,  and  other  traders,  praying  a  charter  of  incorporation, 
empowering  them  to  raise  a  sufficient  sum  of  money  to  purchase 
lands  for  planting  and  rearing  a  wood  called  mader  for  the  use 
of  the  dyers. 

4  Petition  of  Joseph  Galends,  of  London,  snuff-maker,  praying 
a  patent  for  his  invention  to  prepare  and  cure  Virginia  tobacco 
for  snuff  in  Virginia,  and  making  it  into  the  same  within  all 
His  Majesty’s  dominion.’ 

Even  after  this,  a  few  companies  still  continued  to 
do  business,  and,  at  the  instance  of  the  South  Sea 
Company,  which,  thinking  to  serve  its  own  interests, 
acted  as  a  common  informer,  the  Lords  Justices  ordered 
a  writ  of  scire  facias  to  be  issued  against  the  York 
Buildings,  English  Copper,  and  Welch  Copper  Companies, 
by  name,  and  generally  against  all  other  projects  estab¬ 
lished  in  defiance  of  the  law.  Before  taking  this  step, 
however,  they  informed  the  Prince  of  Wales  of  their 
intention  to  include  the  4  bubble  5  with  which  he  had 
associated  himself :  whereupon  His  Royal  Highness, 
having  made  all  the  profit  he  could  out  of  the  transaction, 
promptly  sent  a  message  to  the  Company  with  which 
he  was  connected,  desiring  them  forthwith  to  select 
another  Governor. 

The  various  Directors  of  the  recalcitrant  companies 
were  summoned  before  the  Lord  Justices  in  Council  on 
August  23,  when  the  reasons  which  had  occasioned 
their  prosecution  were  explained.  All  attended,  and 
most,  convinced  that  it  would  go  ill  with  them  if  they 


‘BUBBLE’  COMPANIES 


109 


continued  to  defy  the  law,  made  submission.  A  few, 
however,  having  consulted  counsel,  announced  their 
intention  to  stand  their  trial,  and  assert  their  right  to 
manage  their  affairs  as  they  pleased.  The  Welch  Copper 
Company  was  even  more  bold,  and  on  the  very  day  on 
which  they  attended  Whitehall,  opened  their  books  and 
made  transfers  of  the  stock.  Upon  this,  the  South  Sea 
Company  caused  the  following  manifesto  to  be  issued 
and  widely  circulated  : — 

‘  Whereas  their  Excellencies  the  Lords  Justices  have  been 
pleased,  in  the  Gazette  of  Saturday  last  (August  20),  to  order 
writs  of  scire  facias  to  be  brought  against  all  unlawful  under¬ 
takings,  among  which  the  Company  of  Welch  Copper  Miners 
with  three  others  are  named,  and  the  gentlemen  of  that  society 
have  thereupon  ordered  their  books  and  charter  to  be  laid 
before  Mr.  Attorney- General,  a  society  of  loyal  citizens,  who 
have  at  heart  their  utmost  acknowledgments  for  this  season¬ 
able  interposition  of  their  Excellencies,  by  their  commands,  to 
suppress  what  struck  at  the  root  of  trade  in  general,  and  had 
brought  it,  in  a  manner,  to  its  last  declension,  hereby  testify 
their  utmost  duteous  thanks  for  the  hopes  they  have  of  the 
restoration  of  commerce  to  a  very  flourishing  condition.  And 
whereas,  notwithstanding  the  late  Proclamation,  Act  of  Parlia¬ 
ment,  and  their  Excellencies’  order,  the  said  Company  continue 
to  negotiate  their  affairs,  and  to  admit  transfers  of  the  said 
stock  to  be  made  and  accepted,  the  above-mentioned  citizens 
desire  to  know  of  these  contraveners  of  law  and  command 
what  answer  they  can  give  to  the  following  queries  :  What  was 
the  amount  of  their  capital  stock  on  or  before  Christmas  last  ? 
How  much  was  added  thereto  by  their  late  subscription,  and 
what  part  of  the  said  subscriptions  were  given  gratis  among 
the  managers  of  the  said  undertaking  ?  Also,  how  long  it  was 
before  the  said  subscription,  that  the  Company  acted,  and 
what  was  the  occasion  of  their  ceasing  to  act,  when  they  laid 
by  for  a  considerable  time  ?  ’ 

It  was  soon  seen,  however,  that  the  game  was  not 
worth  the  candle.  The  mere  announcement  in  the 
Gazette  that  the  writ  of  scire  facias  had  been  issued  at 
once  sent  down  the  price  of  the  stocks.  York  Buildings 


110 


THE  SOUTH  SEA  BUBBLE 


shares  fell  on  August  20  from  300  to  200,  and  two  days 
later  there  were  no  buyers  at  any  price  for  the  stock  of 
this  or  any  of  the  other  three  companies  specially  named. 
‘  The  bubbles  instead  of  a  million  have  by  underhand 
ways  projected  to  increase  their  stocks  to  millions, 
without  end,  have  forced  the  Government  to  go  about 
to  suppress  them,’  Mrs.  Windham  wrote  to  Ashe  Wind¬ 
ham,  August  23,  ‘  and  if  they  cannot  do  it,  the  Parlia¬ 
ment  must,  or  millions  must  be  undone,  for  how  can 
the  lutestring,  and  Thames  water,  or  Insurance,  employ 
millions  ?  Abundance  (sic)  will  be  losers  now ;  Sir 
Alex.  Cam  (sic)  £40,000,  Lord  Westmorland  £150,000, 
and  lesser  people  in  abundance**  Stocks  that  sell  at  a 
hundred  cannot  divide  9 d.,  some  not  Jd.’  1 

1  Ketton  MSS .,  201. 


CHAPTER  V 


The  *  Slump '  in  the  Stock  of  the  South  Sea 

Company 

AUGUST-SEPTEMBER,  1720 

IT  had  been  the  intention  of  the  Directors  of  the  South 
Sea  Company  to  issue  early  in  August  a  Fourth 
Money-Subscription.  This,  however,  had  been  post¬ 
poned  at  the  desire  of 4  some  persons  in  eminent  stations  5 
until  the  proprietors  of  the  remaining  Long  Annuities 
had  been  given  another  opportunity  to  exchange  them 
for  the  stock  of  the  Corporation.  The  ostensible  reason, 
and  that  given  to  the  Directors,  for  requiring  the  post¬ 
ponement  was  that  the  taking  in  of  the  public  debts, 
in  order  to  make  them  redeemable,  was  the  main  view 
upon  which  the  Ministry  and  Parliament  had  thought 
fit  to  pass  the  Act.  The  pretext  appeared  sound,  but 
it  was  by  some  shrewdly  surmised  that  the  cause  of  the 
interference  was  the  wish  of  those  in  high  places  4  not 
only  to  free  themselves  from  the  importunity  of  many 
who  sued  to  be  set  down  in  the  list  for  a  share  in  the 
next  subscription,  but  also  in  order  to  reserve  part  of 
the  to  be  increased  capital  stock  till  a  new  set  of  Directors 
were  chosen  [in  the  following  year],  who  should  have  a 
share  in  the  profits  of  future  subscriptions,  in  case  the 
humour  of  buying  up  the  same  at  an  advanced  price 
should  last  so  long.’ 1 

1  Parliamentary  History ,  VII,,  661, 

111 


112 


THE  SOUTH  SEA  BUBBLE 


The  Directors,  however,  were  not  hoodwinked,  and 
though  they  consented  to  postpone  the  issue  until  after 
taking  in  the  public  debts,  they  began  to  make  prepara¬ 
tions  for  the  new  subscription.  At  a  Court  held  on 
July  27  it  was  put  on  record  that  several  persons  who 
had  been  admitted  as  subscribers  to  the  Third  Money- 
Subscription  had  not  paid  the  first  instalment,  and  it 
was  resolved,  4  That  none  but  the  proprietors  of  the 
Company’s  capital  and  increased  stock  should  be  ad¬ 
mitted  into  the  next  subscription  in  money,  at  the  rate 
of  twenty  per  cent.,  so  that  a  proprietor  of  £1,000  capital 
stock  should  be  entitled  to  subscribe  £200.’  The  reason 
given  publicly  for  passing  the  Resolution  was  to  allay 
the  discontent  of  the  original  proprietors  who  complained 
bitterly  that  the  Directors  and  their  associates  had  con¬ 
trived  to  pocket  the  profits  of  the  earlier  subscriptions. 
The  original  proprietors,  however,  looked  upon  this  step 
with  suspicion,  and  many  declared  that  ‘  the  Directors 
having  got  the  cream  for  themselves  would  now  give 
the  proprietors  the  sour  milk  ’ ;  nor  was  this  suspicion 
removed  when  it  became  known  that  a  great  number  of 
those  who  had  secured  allotments  of  the  previous  issues 
had  sold  out  their  holdings  at  vastly  enhanced  prices, 
and  that  Sir  John  Blunt  had  recently  purchased  con¬ 
siderable  estates  in  Norfolk.  The  Directors,  or  the 
greater  number  of  them,  were  concerned  only  with  their 
own  interests,  and  cared  nothing  for  the  proprietors ; 
and  there  can  be  little  doubt  that  this  Resolution  was 
made  because,  since  it  seemed  highly  probable  that,  in 
the  unsettled  state  of  the  market,  the  public  might  not 
come  in,  the  Company  would,  in  the  case  of  the  pro¬ 
prietors  taking  up  the  issue,  at  least  have  as  security 
for  payment  of  the  instalments  the  capital  stock  already 
held  by  them. 


THE  ‘SLUMP5 


113 


As  regards  subscribing  to  this  issue  at  £1,000  for  every 
£100  capital  stock,  the  case  has  been  admirably  put  by 
Archibald  Hutcheson,  who,  for  the  purposes  of  his  argu¬ 
ment,  used  A  to  denote  the  original  stock,  B  the  First 
Subscription,  C  the  Second  Subscription,  and  D  the 
Third  and  Fourth  Subscriptions.  ‘  A  having  a  £100 
stock  in  trade,  though  pretty  much  in  debt,  gives  it 
out  to  be  worth  £300,  on  account  of  many  privileges  and 
advantages  to  which  it  is  entitled,5  so  runs  the  argument, 
‘  B,  relying  on  A’s  great  wisdom  and  integrity,  sues  to  be 
admitted  partner  on  those  terms,  and  accordingly  brings 
£300  into  the  partnership.  The  trade  being  afterwards 
given  out  or  discovered  to  be  very  improving,  C  comes 
in  at  £500,  and  afterwards  D  at  £l,100.  And  the  capital 
is  then  completed  to  £2,000.  If  the  partnership  had 
gone  no  farther  than  A  and  B,  then  A  had  got,  and  B 
had  lost,  £200.  If  it  had  stopped  at  C,  then  A  had  got, 
and  C  had  lost,  £200,  and  B  had  been  as  he  was  before  ; 
but  D  also  coming  in,  A  gains  £400  and  B  £200,  and  C 
neither  gains  nor  loses,  but  D  loses  £600.  Indeed,  if  A 
could  show  that  the  said  capital  was  intrinsically  worth 
£4,400,  there  would  be  no  harm  done  to  D,  and  B  and  C 
would  have  been  much  obliged  to  him.  But  if  the 
capital  at  first  was  worth  the  £100,  and  increased  only 
by  the  subsequent  partnerships,  it  must  then  be  acknow¬ 
ledged  that  B  and  C  have  been  imposed  on  in  their  turns, 
and  that  unfortunate  thoughtless  D  paid  the  piper.’ 
The  public,  however,  declined  to  reason,  and  rushed 
blindly  into  disaster.  When  the  books  were  opened  on 
August  24  for  the  Fourth  Money-Subscription,  the  entire 
issue  was  taken  up  within  three  hours,  and  in  the  after¬ 
noon  of  the  same  day  was  quoted  at  a  premium  of  £40 
per  cent.  In  spite  of  the  more  than  adequate  response 
to  the  Fourth  Subscription,  the  effects  of  the  closing 


114 


THE  SOUTH  SEA  BUBBLE 


down  of  the  4  bubbles  ’  was  making  itself  felt.  In 
causing  the  suppression  of  these  minor  companies,  the 
South  Sea  Directors  had,  in  their  own  interests,  blundered 
sadly.  They  had  acted  under  the  impression  that  the 
traffic  in  the  shares  of  the  *  bubbles,’  by  diverting  money, 
obstructed  the  rise  of  the  South  Sea  stock.  As  a  matter 
of  fact,  exactly  the  opposite  was  the  case.  Small  specu¬ 
lators  who  gambled  in  the  little  companies  invested 
their  profits  in  the  stock  of  the  greater  concern.  What 
was  more  fatal,  however,  was  that  a  feeling  of  distrust 
was  generated  by  the  destruction  of  the  4  bubbles,’  and 
it  recoiled  upon  the  South  Sea  Company. 

After  the  transfer-books  of  the  Company  were  re¬ 
opened  on  August  26,  the  price  of  the  stock  fell  slowly 
but  surely,  and  although  great  quantities  of  stock  had 
been  bought  at  1,000,  and  even  at  higher  rates,  for  the 
opening  of  the  books,  it  was  within  a  few  days  purchas¬ 
able  at  820.  Indeed,  the  depreciation  would  have  been 
greater  but  for  the  efforts  of  the  Directors,  who  did 
everything  in  their  power  to  steady  the  market,  and 
not  only  lent  money  on  its  own  securities,  but,  in  defiance 
of  its  rules,  instructed  their  brokers  recently  to  purchase 
stock  on  behalf  of  the  Company. 1  The  Directors,  realis¬ 
ing  that  many  holders  of  stock  would  have  to  sell  part 
of  their  holding  in  order  to  pay  the  differences,  which 
would  certainly  tend  still  further  to  lower  the  price, 
suddenly  and  unexpectedly  resolved  to  shut  the  books. 
The  4  Court  of  Directors  of  the  South  Sea  Company,’  so 
ran  the  announcement,  4  give  notice  that  the  transfer- 

1  4  It  is  ordained,  that  the  Court  of  Directors  shall  not  invest 
any  of  the  Company’s  money  or  effects  whatsoever,  in  the 
purchasing  any  part  of  share  in  the  Capital,  or  Additional 
Fund,  or  Stock  of  this  Company,  without  the  consent  of  the 
General  Court  first  had.’ — Byelaw  16. 


115 


THE  4  SLUMP  * 

<£ 

books  of  the  Company  will  be  shut  from  the  31st  day 
of  August  to  the  21st  of  September,  in  order  to  the  admit¬ 
ting  as  well  the  proprietors  of  the  original  capital  stock 
and  of  the  stock  for  the  last  Midsummer  dividend,  as 
the  proprietors  of  the  stock  for  all  the  Long  Annuities, 
Nine-per-cents.,  and  Tickets  of  Lottery  1710,  and  of  the 
several  redeemable  debts,  which  have  been  subscribed 
or  deposited,  or  authorised  to  be  subscribed  into  the 
capital  stock,  and  also  the  proprietors  of  the  first,  second, 
third,  and  fourth  money-subscriptions  of  the  Company 
into  a  subscription  twenty  per  cent,  of  the  capital  stock, 
upon  the  terms  agreed  by  the  Court  of  Directors.  The 
Company  will  lend  the  first  payment  for  the  intended 
subscription  to  all  the  proprietors  of  the  original  and 
dividend  stock,  and  of  the  subscription  in  the  Long 
Annuities,  Nine-per-cents.,  and  Tickets  of  Lottery  1710, 
and  in  the  redeemable  debts  ;  and  of  the  first  and  second 
money-subscriptions,  without  transferring  their  stock, 
and  depositing  the  subscription  receipts  ;  which  sub¬ 
scription-books  will  be  open  on  September  12  ;  and 
such  of  the  proprietors  as  do  not  subscribe  within  that 
time  will  be  excluded  the  benefit  of  the  subscrip¬ 
tion.’ 

The  financial  position  was  the  cause  of  much  anxiety 
to  those  who  were  watching  the  interests  of  the  nation, 
and  the  situation  certainly,  if  not  yet  dangerous,  was 
such  that  at  any  moment  it  might  become  so.  4  All  I 
can  inform  your  Lordship  of  at  present  from  hence  is 
that  there  has  been  a  hard  struggle  to  keep  the  stocks 
up,  and  if  they  rise  after  the  books  are  shut,  which  is 
after  to-morrow,  all  will  go  well ;  otherwise  I  wTon’t 
answer  what  will  become  of  them,’ Lord  Bathurst1  wrote 

1  Allen  Bathurst,  Baron  Bathurst  (1G84-1775),  created  Earl 
Bathurst,  1772. 


116 


THE  SOUTH  SEA  BUBBLE 


to  Lord  Strafford,1  August  30.  4  This  is  now  the  crisis, 

in  my  opinion.  I  don’t  find  the  Dutch  do  us  any  great 
harm,  the  exchange  altered  a  little,  but  is  now  again 
in  our  favour,  which  is  a  proof  as  certain  as  can  be  ; 
but  there  has  been  considerable  sums  sent  to  Portugal, 
and  that  has  been  more  prejudicial  to  our  stocks.  Be¬ 
sides  which  some  of  the  Directors  have  been  playing  the 
rogue  and  have  endeavoured  to  run  down  the  stocks 
after  having  sold  their  owTn  out,  in  order  to  buy  in  cheap 
again.  This  has  put  people  in  a  fright,  and  it  is  not 
so  easy  to  bring  them  out  again  ;  but  I  expect  a  consider¬ 
able  alteration  in  a  few  days.  As  to  the  Lutestring 
(sic)  which  your  Lordship  was  merry  upon  in  your  last 
letter,  I  believe  our  schemes  are  defeated.  I  had  infor¬ 
mation  from  those  who  were  in  the  secret  and  bought  a 
good  deal  for  the  opening  of  the  books,  and  if  the 
Regency  would  have  let  them  alone  it  would  have  risen 
prodigiously,  but  I  think  they  were  much  in  the  right  to 
knock  all  those  “  bubbles  ”  on  the  head,  and  I  lose  nothing 
by  it  but  the  hopes  of  gain  which  nobody  can  part  with 
easier  than  I  can  ;  for  those  books,  I  believe,  will  never 
open  again,  unless  they  can  make  such  interest  with  the 
Government  as  to  be  sure  that  they  shall  not  be  pro¬ 
secuted,  and  in  that  case  the  bargains  that  have  been 
made  for  the  opening  of  the  books  will  be  beneficial 
enough.  But  for  my  own  part  I  think  if  the  great 
“bubble”  can  be  supported  that’s  enough  for  the 
kingdom.’ 2 

The  annuitants  who  had  subscribed  their  public 
securities  in  exchange  for  South  Sea  stock  at  £800  per 
cent.,  now  that  it  had  fallen  below  that  price  loudly 

1  Thomas  Wentworth,  third  Earl  of  Strafford  (1672-1739). 

2  Wentworth  Papers ,  448. 


THE  ‘SLUMP’ 


117 


voiced  their  grievance,  and  demanded  to  be  released 
from  their  bargain.  The  clerks  at  the  South  Sea  House 
declined  to  return  the  securities  that  had  been  lodged, 
and  the  proprietors  returned  with  a  public  notary,  who 
protested  in  due  form,  and  announced  their  intention  to 
take  the  matter  into  the  law-courts.  ‘  In  the  meantime,’ 
says  the  Parliamentary  History ,  6  they  loudly  complained 
of  the  unfair  manner  in  which  they  were  drawn  in  to 
subscribe  their  annuities,  for,  it  seems,  at  the  top  of 
every  page  of  the  subscription-book  there  was  a  short 
letter  of  attorney,  whereby  the  subscribers  empowered 
three  persons,  therein  named,  to  accept  such  terms  as 
the  Company  should  think  fit  to  give  them  for  their 
effects  ;  which  they  alleged  to  be  a  mere  trick,  not  one 
in  a  hundred  of  the  subscribers  having  read  the  ensnaring 
preamble.’ 1 

In  order  to  silence  these  malcontents,  and  other 
grumblers,  the  Directors  now  took  a  bold  step,  and  on 
August  30  announced  that  they  had  passed  a  Resolution, 
4  That  the  next  Christmas  dividend  on  the  stock  and 
subscriptions  in  money  should  be  thirty  per  cent.,  and 
that  a  dividend  of  not  less  than  fifty  per  cent,  per  annum 
be  made  from  and  after  Christmas  next,  in  half-yearly 
payments,  for  not  less  than  twelve  years,  upon  the  whole 
stock  and  subscriptions.’  This  sounded,  of  course,  very 
magnificent,  but  a  moment’s  reflection  showed  that,  as 
regards  the  Third  and  Fourth  Subscriptions,  issued  at 
£1,000  per  cent.,  it  was  really  only  a  dividend  of  five  per 
cent.  The  announcement,  however,  sufficed  to  send 
up  the  price  of  the  stock  from  780  to  810,  but  so  many 
people  took  the  opportunity  to  unload  that  on  Septem¬ 
ber  2  it  had  fallen  to  700.  To  declare  any  dividend 
for  twelve  years  in  advance  was  not  only  an  audacity 

1  Vol.  VII.,  p.  666. 


118 


THE  SOUTH  SEA  BUBBLE 


but  an  unsound  financial  proposition.  4  Had  all  the 
remaining  public  debts  been  taken  in  at  the  price  of 
the  last  subscription,’  Macpherson  has  summed  up  the 
situation,  4  and  had  the  four  sets  of  money  subscribers 
duly  made  good  all  their  payments,  and,  moreover,  had 
the  Company  been  able  to  sell  all  their  remaining  stock 
at  £1,000  per  cent.,  or  higher,  and  third  loans  of  money 
had  all  been  duly  repaid,  upon  these  suppositions  the 
Company  might  possibly  have  been  able  to  have  made 
so  vast  a  dividend  for  at  least  part  of  the  twelve  years  ; 
but  that  would  have  been  attended  with  the  certain 
and  grievous  future  loss  in  their  principal  as  well  as 
interest.’1 

The  proposed  resolution  had  to  be  sanctioned  by  the 
stock-holders,  and  it  was  put  to  them  at  the  half-yearly 
General  Court,  held  on  September  8,  by  Sir  John  Fel- 
lowes,  the  Sub-Governor,  and  accepted  with  enthusiasm. 
James  Craggs  the  elder  complimented  the  proprietors 
upon  their  roseate  prospects,  and  moved  that  the  report 
be  accepted.  The  motion  was  seconded  by  John 
Hungerford  in  a  most  optimistic  speech.  4 1  have  seen 
the  rise  and  fall,  the  decay  and  resurrection  of  many 
communities  of  this  nature,’  he  said,  4  but  in  my  opinion,  * 
none  have  performed  such  wonderful  things  as  the  South 
Sea  has  brought  about.  The  Directors  have  done  more 
than  the  Crown,  the  pulpit,  and  the  magistrate  could 
do,  for  they  have  reconciled  all  parties  in  a  common 
interest,  and  have  thereby  laid  asleep,  if  not  wholly 
extinguished,  our  domestic  jars  and  animosities.  By 
the  rise  of  these  stocks  the  moneyed  men  have  vastly 
increased  their  fortunes  ;  the  country  gentlemen  have 
seen  the  value  of  their  lands  doubled  and  trebled  in 
their  hands  ;  and  we  have,  at  the  same  time,  done  good 
1  Annals  of  Commerce ,  III.,  101, 


James  Craggs  the  Elder 


From  a  portrait  by  Zincke 

\  ' 


/>.  1 1  s 


THE  ‘SLUMP’ 


119 


to  the  Church,  not  a  few  of  the  reverend  clergy  having 
got  great  sums  by  this  project.  In  short,  they  have 
enriched  the  whole  nation  ;  and  I  hope  they  have  not 
forgotten  themselves.’  Further  support  of  the  Directors, 
and  support  which  was  certainly  disinterested,  came 
from  the  Duke  of  Portland,1  who  said  that  he  knew  that 
there  were  some  who  were  grumbling,  but  that,  for  his 
part,  he  did  not  know  what  reason  any  one  had  to  be 
dissatisfied.  Presently,  at  heavy  cost  to  himself,  he 
was  to  learn.  The  meeting  which  sanctioned  the 
dividend  gave,  however,  anything  but  a  patient  hearing 
to  those  who  put  the  case  of  the  annuitants,  and  it 
rejected,  by  a  large  majority,  a  motion,  ‘  That  the  last 
subscribers,  both  of  the  redeemable  and  irredeemable 
funds,  should  have  the  alternative  either  to  withdraw 
or  accept  the  terms  offered  them  by  the  Court  of  Direc¬ 
tors.’  The  General  Court  then  passed  further  resolu¬ 
tions,  designed  to  reassure  and  give  relief  to  the  stock¬ 
holders,  and  these  were  publicly  announced  on  Septem¬ 
ber  10  :  ‘  The  Court  of  Directors  of  the  South  Sea 

Company  give  notice,  that  the  dividends  for  Christmas 
next  and  afterwards,  voted  by  the  General  Court  of  the 
said  Company  on  the  8th  inst.,  which  shall  become  due 
on  the  four  Money-Subscriptions  already  taken  for  sale 
of  the  stock  of  the  said  Company,  will  be  allowed  in 
part  of  the  payment  which  shall  become  due  on  the  said 
subscriptions  ;  and  that  the  ten  per  cent,  stock  for  the 
last  Midsummer  dividend  on  the  first,  second,  and  third 
of  the  said  Money-Subscriptions,  will  be  entitled  to  the 
like  dividends,  and  be  allowed  in  further  part  of  the  pay¬ 
ment  on  those  subscriptions.  And  whereas  the  transfer- 

1  Henry  Bentinck,  first  Duke  of  Portland  (d.  1726),  the  son 
of  William,  first  Earl  of  Portland,  whom  he  succeeded  in  1709  ; 
created  Duke,  1716. 


120 


THE  SOUTH  SEA  BUBBLE 


books  of  the  said  Company  was  advertised  to  be  shut 
from  and  after  Wednesday,  the  31st  of  August  last,  to 
Wednesday,  the  21st  of  September  instant,  in  order  to 
the  making  the  subscription  of  twenty  per  cent,  intended 
for  the  proprietors  ;  and  the  General  Court  having  since 
agreed  that  the  said  subscription  be  omitted,  the 
said  Court  of  Directors  give  notice  that  the  transfer- 
books  of  the  said  Company  will  be  opened  on  Mon¬ 
day,  the  12th  instant,  and  will  continue  open  as 
usual.5 

Though  the  speakers  at  the  General  Court  were  appar¬ 
ently  so  optimistic,  the  distrust  of  the  public  greatly 
increased,  while  the  suspicions  of  the  honesty  of  the 
Directors  became  so  strong  that,  on  the  day  after  the 
meeting,  the  stock,  which  had  already  fallen  to  640,  was 
quoted  at  550.  4  Yesterday,5  Matthew  Prior1  wrote  to 

Lord  Harley,  4  the  world  was  in  a  panic  fear  ;  the  South 
Sea  ebbed  hourly  by  fifty  and  sixty  down  to  500  ;  but 
the  apprehension  vanished  as  insensibly  as  it  came  on ; 
the  stock  rose  again  to  above  600  ;  the  Alley  rang  with 
cheers,  and  things  go  on  sicut  olirn .’ 2  Three  days  later 
Prior  wrote  again  to  the  same  correspondent :  4  South 
Sea  falls,  notwithstanding  which  the  merchants  are 
insolent  and  the  Ministry  despicable  in  the  City.5  3 
Another  view  of  the  situation  is  given  in  a  letter  from 
a  man  more  versed  in  business  methods.  4 1  came  (as 
I  told  you  I  would)  to  town,  in  order  to  adjust  the 
matter  of  your  lottery  tickets,  pursuant  to  the  adver¬ 
tisement  from  the  South  Sea  Company,5  Thomas 
Brodrick  wrote  to  Lord  Middleton,  September  13. 
4  Yesterday  was  the  day  appointed,  but  (as  is  customary 

1  Matthew  Prior  (1664-1721),  the  poet  and  diplomatist. 

2  Bath  MSS.,  III.,  488. 

3  Ibid.,  III.,  489. 


THE  ‘SLUMP5 


121 


with  them)  they  have  put  it  off,  and  those  concerned 
are  to  wait  their  leisure,  and  take  such  satisfaction  as 
they  think  fit  to  give.  We  have  made  them  Kings, 
and  deal  with  everybody  as  such  ;  those  who  submit 
and  subscribe,  are  at  their  mercy ;  those  who  do  not, 
are  to  be  oppressed  in  such  manner  as  shall  make  what 
is  due  to  them  of  little  use  ;  and  all  this,  I  suppose, 
they  are  to  be  supported  in,  having  engaged  the  House 
of  Commons  so  far  in  their  interest,  by  ways  obvious 
to  everybody,  that  I  think  the  nation  will  have  to  bear 
such  part  of  the  loss  sustained  by  private  persons,  as 
the  Company  shall  think  fit ;  whilst  the  game  obtained 
by  fraud  and  villainous  practices  is  to  turn  to  their 
advantage.  I  foresaw  this  from  the  beginning,  and  have 
as  many  witnesses  of  it  as  persons  I  conversed  with  ; 
but  I  own  I  thought  they  would  have  carried  on  the  cheat 
somewhat  longer.  Various  are  the  conjectures  why  they 
suffered  the  cloud  to  break  so  early.  I  made  no  doubt 
but  it  would  do  so  when  they  found  it  for  their  advan¬ 
tage,  which  not  being  the  case  just  at  this  time,  some 
other  reason  must  be  found  ;  and  the  true  one  I  take  to 
be,  stretching  credit  so  far  beyond  what  it  would  bear, 
that  specie  proved  deficient  for  supporting  it,  by  circu¬ 
lating  paper.  It  is  observable  that  many  of  their  most 
considerable  men,  with  their  fast  friends,  the  Tories, 
Jacobites,  and  Papists  (for  these  they  have  all  along 
hugged),  have  drawn  out,  securing  themselves  by  the 
losses  of  the  deluded  thoughtless  numbers,  whose  under¬ 
standings  were  overruled  by  avarice,  and  hopes  of  mak¬ 
ing  mountains  out  of  molehills.  Thousands  of  families 
will  be  reduced  to  beggary.  What  the  consequences  of 
that  must  be,  time  will  show.  I  know  what  I  thought 
from  the  beginning,  and  fear  it  is  very  near  at  hand. 
The  consternation  is  inexpressible,  the  rage  beyond 


122 


THE  SOUTH  SEA  BUBBLE 


expression,  and  the  case  so  desperate,  that  I  do  not  see 
any  plan  or  scheme  so  much  as  thought  of,  for  averting 
the  blow,  so  that  I  can’t  pretend  to  guess  at  what  is  next 
to  be  done.’  1  Strongly  as  Brodrick  spoke,  when  he 
designated  the  scheme  as  a  cheat,  he  was  not  one  whit 
more  emphatic  than  the  majority  of  those  who  believed 
that  they  had  been  tricked  and  knew  that  they  had 
been  ruined. 

By  this  time  the  Directors  were  thoroughly  alarmed, 
and  were  anxiously  seeking  some  way  of  escape  from  the 
ruin  which  threatened  the  Company.  No  longer  arro¬ 
gant,  they  were  prepared  to  eat  any  amount  of  humble 
pie,  if,  by  so  doing,  they  could  avert,  or  even  postpone, 
the  evil  day.  They  made  secret  overtures  for  amalgama¬ 
tion  to  the  East  India  Company  ;  but  the  proposal  was 
not  for  a  moment  entertained.  They  then  approached 
the  Bank  of  England,  and  in  this  matter  they  had  the 
support  of  Craggs  the  younger,  the  Secretary  of  State, 
who  exercised  such  pressure  as  he  could  bring  to  bear, 
and  did  indeed  succeed  so  far  as  to  induce  the  Bank  to 
consent  to  meet  the  Directors  of  the  South  Sea  Company. 
Upon  the  knowledge  of  this  becoming  public  on  Septem¬ 
ber  12,  a  rumour  spread  that  the  older  corporation  had 
consented  to  circulate  £6,000,000  of  the  South  Sea 
Company’s  bonds.  This  was,  indeed,  good  news,  for, 
if  true,  it  showed  that  there  was  no  ground  for  panic, 
and  the  stock  rose  to  670,  only  to  fall  in  the  afternoon  to 
580  when  it  became  known  that  the  report  was  ground¬ 
less.  The  matter,  however,  did  not  rest  here,  for  Wal¬ 
pole  was  induced  to  come  up  from  the  country  to  use 
his  influence  with  the  Bank  to  persuade  it  to  come  to 
the  assistance  of  its  rival. 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  190. 


THE  ‘SLUMP’ 


123 


Walpole  prevailed  ;  a  definite  proposal  was  submitted 
by  the  South  Sea  Company  to  the  Bank  on  September 
16,  and  three  days  later  a  conference  between  the  Direc¬ 
tors  of  the  two  corporations  took  place  at  the  house 
of  the  Postmaster-General,  James  Craggs  the  elder. 
The  Lord-President,  James  Craggs  the  younger,  Aislabie, 
Walpole,  and  the  Postmaster- General  were  present ; 
the  South  Sea  Company  was  represented  by  Sir  John 
Fellowes,  Charles  Joye,  Sir  Theodore  Janssen,  John 
Gore,  and  Robert  Chester  ;  and  the  bank  by  Hangar, 
the  Governor,  Sir  John  Ward,1  Sir  Gilbert  Heathcote,2 
Sir  Peter  Delme,3  and  Sir  Nathaniel  Gould.4  At  this 
meeting,  in  spite  of  the  fact  that  the  Bank  did  not  hide 
its  reluctance  to  take  any  part  in  the  business,  the 
attitude  of  the  South  Sea  Directors  was  at  first  over¬ 
bearing.  They  demanded  an  immediate  assurance  from 
the  Bank  that  it  would  come  to  their  assistance  :  to 
this  Heathcote  made  reply  dryly,  ‘  I  can  by  no  means 
be  so  hasty,  for  old  men  cannot  walk  so  fast  as  the 
young.’  They  then,  somewhat  peremptorily,  desired 
that  the  Sword-blade  Company  (the  principal  cash- 
keepers  of  the  larger  concern)  should  come  into  the 

1  Sir  John  Ward,  son  of  Sir  Thomas  Ward  of  Tanshelf,  and 
nephew  of  Sir  Patience  Ward,  Lord  Mayor  of  London  in  1681. 
Sir  John  Ward,  the  ancestor  of  the  Wards  of  Westerham,  was 
Lord  Mayor  in  1714. 

2  Sir  Gilbert  Heathcote  (1651  ?-1733),  a  founder  of  the  East 
India  Company,  1693,  and  of  the  Bank  of  England,  1694  ; 
entered  Parliament,  1700  ;  knighted,  1702  ;  Lord  Mayor, 
1710-1711  ;  created  baronet,  1733.  He  is  mentioned  by  Pope 
in  his  4  Moral  Essays  ’  (Ep.  III.)  : — 

‘  The  grave  Sir  Gilbert  holds  it  for  a  rule 
That  every  man  in  want  is  knave  or  fool.’ 

3  Sir  Peter  Delme,  Alderman  of  Langborn  Ward,  knighted 
at  St.  James’s,  September  23,  1714. 

4  Sir  Nathaniel  Gould,  M.P.  for  New  Shoreham, 


124 


THE  SOUTH  SEA  BUBBLE 


treaty — 4  By  no  means,’  retorted  Heathcote,  4  for  if  the 
South  Sea  Company  is  to  be  wedded  to  the  Bank,  it 
cannot  be  allowed  to  keep  a  mistress.’  The  conference 
lasted  from  nine  o’clock  in  the  evening  until  three 
o’clock  the  next  morning,  and  in  the  end  the  Bank  con¬ 
sented  further  to  consider  the  matter.  Beyond  this  it 
would  not  in  any  way  pledge  itself ;  though  it  raised 
no  objection  to  the  suggestion  that  Walpole  should 
draft  an  agreement,  which,  should  negotiations  proceed, 
might  serve  as  a  basis  for  argument. 

Walpole  then  drew  up  the  following  document :  4  That 
the  Bank  of  England  shall  undertake  to  circularise 
£3,000,000  of  South  Sea  bonds  for  one  year,  at  a  premium 
to  be  agreed  upon  by  the  two  companies  ;  a  subscrip¬ 
tion  to  be  taken  for  enabling  the  Bank  to  carry  on  the 
circulation,  —  per  cent,  to  be  paid  by  every  subscriber, 
and  • —  per  cent,  upon  every  call  at  a  fortnight’s  notice  ; 
the  contract  with  the  subscribers  to  be  made  in  the 
nature  and  form  with  former  contracts,  for  circulating 
Exchequer  bills,  and  the  charges  of  circulation  to  be 
borne  by  the  South  Sea  Company.  That,  in  considera¬ 
tion  of  this  undertaking,  the  South  Sea  Company  shall 
pay  the  £3,700,000  to  be  paid  to  the  Bank,  by  notice  of 
Parliament,  at  a  price  to  be  agreed  upon  by  the  two 
companies.’  This  was  afterwards  referred  to  as  the 
4  Bank  Contract,’  and  as  it  was  not  carried  out,  charges 
of  bad  faith  were  levelled  at  the  older  corporation.  As 
a  matter  of  fact,  however,  not  only  was  it  not  binding 
on  either  party,  but  clearly  it  was  not  intended  to  be 
binding,  since  the  price  at  which  the  stock  was  to  be 
transferred  was  not  settled. 

This,  however,  did  not  prevent  the  South  Sea 
Directors  at  a  General  Court  on  the  next  day,  when  the 
stock  had  fallen  to  400,  from  stating  that  a  definite 


125 


THE  4  SLUMP  ’ 

M 

arrangement  had  been  made.  4  Since  our  last  meeting,’ 
said  Sir  John  Fellowes,  the  Sub-Governor,  4  our  stock 
having  taken  an  unexpected  turn  to  the  disadvantage 
of  the  Company,  the  Directors  have  been  consulting 
what  might  be  best  for  the  benefit  of  the  Corporation, 
and,  considering  the  great  credit  the  Bank  of  England 
has  justly  gained  both  at  home  and  abroad,  they  have 
thought  it  for  their  interest  to  treat  with  that  company 
for  the  circulating  their  bonds,  and  to  grant  them  stock 
at  a  moderate  price,  in  lieu  of  the  £3,700,000,  which 
the  South  Sea  Company  was  to  pay  them  at  Ladyday 
and  Michaelmas,  1721.  From  the  result  of  the  meeting 
we  had  last  night  with  some  gentlemen  of  the  Bank 
and  some  persons  of  first  rank,  we  do  not  doubt  but 
such  an  agreement  may  soon  be  perfected.’  The  state¬ 
ment  of  the  chairman  was  much  to  the  liking  of  the 
shareholders,  and  a  Mr.  Dawson  moved,  and  Sir  John 
Eyles  seconded,  a  resolution,  4  That  the  Directors  be 
empowered  to  agree  with  the  Bank  of  England,  or  any 
other  persons,  to  circulate  the  Company’s  bonds,  or 
make  any  other  agreement  with  the  Bank  which  they 
should  j  udge  proper.  ’  J  ohn  Hunger  for  d  voiced  the  senti¬ 
ment  of  some  who  were  present  when  he  proposed  to 
amend  the  motion  by  making  definite  mention  of  4  any 
other  agreement  ’ ;  but  William  Pulteney  carried  the 
meeting  with  him  when  he  expressed  the  opinion  that, 
in  the  circumstances,  it  was  desirable  not  in  any  way 
to  fetter  the  power  of  the  Directors.  4  It  is  a  matter 
of  surprise  to  see  what  a  panic  has  seized  upon  the  minds 
of  the  people,  at  a  time  when  the  nation  is  at  profound 
peace,  and  has  nothing  to  fear  either  at  home  or  abroad,’ 
he  remarked.  4  A  rumour  has  been  universally  spread 
that  the  armament  of  the  Spaniards  is  designed  either 
against  Port  Mahon  or  Gibraltar  ;  but  I  take  this  report 


126 


THE  SOUTH  SEA  BUBBLE 


to  be  altogether  false  and  groundless,  and  only  intended 
to  scandalise  that  potentate  and  to  terrify  people  here, 
for  I  myself  have  seen  and  perused  a  copy  of  a  letter, 
written  by  the  express  command  of  the  King  of  Spain 
by  his  Secretary  of  State  to  the  British  Minister  at 
Madrid,  absolutely  denying,  in  the  strongest  terms,  any 
design  of  the  Spanish  forces  against  any  of  his  Britannic 
Majesty’s  dominions.  ...  I  am  as  much  concerned  in 
the  Company  as  most  people,  but  notwithstanding  this 
general  and  terrible  alarm  I  have  not  disposed  of  any 
part  of  my  stock,  for  I  should  think  it  a  scandal  to  be 
rich,  if  the  nation  were  ruined.  I  hope,  however,  the 
case  will  be  quite  otherwise,  and  I  doubt  not  but  the 
Company  will  soon  be  restored  to  its  former  flourishing 
condition,  since  it  is  like  to  be  supported  by  the  Bank 
of  England,  a  corporation  which  by  wise,  though  slow 
and  cautious,  measures  has  established  its  credit,  not 
only  at  home,  but  even  among  foreigners.’  Some 
of  the  Directors  can  scarcely  have  relished  Pul- 
teney’s  statement  that  he  had  not  sold  any  of  his 
stock. 

Although  the  Directors  w^ould  not  admit  defeat,  and 
put  a  bold  front  on  the  whole  matter,  it  was  clearly 
necessary  to  do  something  to  stem  the  torrent  of  abuse 
that  poured  in  upon  them  from  all  quarters,  and  it  was 
with  this  object  that  Sir  Matthew  Decker  moved,  4  That 
power  be  given  to  the  Directors  to  relieve  the  annuitants 
who  came  in  upon  the  last  Subscription.’  This  was 
seconded  by  the  elder  Craggs,  who  remarked,  4  that 
nothing  could  be  more  reasonable  and  just  than  to  give 
satisfaction  to  people  who  had  trusted  their  fortunes 
and  estates  with  the  Company,  and  that  it  would  be  a 
notorious  robbery  to  take  any  advantage  of  their  confi¬ 
dence  in  the  honour  and  integrity  of  the  Directors.’ 


THE  ‘SLUMP’ 


127 


This  brought  to  his  feet  Eustace  Budgell, 1  who  dwelt  on 
the  prodigious  leap  from  a  subscription  at  £400  to  one  at 
£1,000.  He  then  observed  that  the  heavy  fall  in  the 
stock  was  owing  to  rumours,  which  he  hoped  might 
prove  to  be  more  malicious  than  true,  that  some  of  the 
Directors  had  basely  betrayed  the  trust  reposed  in 
them.  ‘  I  think  no  gentleman  need  make  any  apology 
for  speaking  in  a  case  where  the  public  and  his  own 
private  fortune  are  both  at  stake,’  Budgell  continued. 
‘  No  man  can  wish  better  than  I  do  to  this  great — I  wish 
I  could  say,  this  flourishing — company.  I  hope  I  shall 
very  shortly  be  able  to  call  it  so  :  in  the  meantime,  as 
we  are  all  embarked  in  this  same  bottom,  and  must 
sink  or  swim  together,  I  think  it  every  man’s  duty  to 
lay  a  hand  to  a  rope,  and  help  to  weather  the  present 
storm  as  well  as  he  can.  I  am  glad  to  see  the  pro¬ 
ceedings  of  this  General  Court  so  very  different  from 
those  of  the  last ;  for  you  must  give  me  leave  to  say 
that,  in  my  own  poor  opinion,  if  there  had  been  a  design 
laid  at  that  time  to  have  sunk  the  stock,  nothing  could 
have  done  it  more  effectually.  Your  stock  wras  then 
sinking  ;  every  man’s  expectation  was  raised  upon  your 
calling  a  General  Court :  a  General  Court  did  meet ; 
but  not  one  new  step  was  taken  in  it  to  support  the 
stock.  I  rejoice  to  see  those  two  gentlemen  behind  the 
Chair  [James  Craggs  the  elder  and  William  Pulteney], 
whose  credit  nobody  can  doubt,  whose  capacities  no- 

1  Eustace  Budgell  (1686-1737).  When  Addison  in  1714 
became  Secretary  to  the  Lord-Lieutenant  of  Ireland,  he  ap¬ 
pointed  Budgell,  who  was  his  cousin,  Under-Secretary,  which 
post  he  held  for  about  six  years.  He  was  member  for  Mullingar 
in  the  Irish  Parliament,  1715-1727,  Budgell  stated  that  he 
lost  £20,000  in  the  South  Sea  Company.  He  was  a  man  of 
many  grievances  and  the  author  of  many  pamphlets. 


128 


THE  SOUTH  SEA  BUBBLE 


body  can  question,  appear  so  hearty  now  in  our  common 
cause.  I  am  very  glad  to  find  that,  since  the  mountain 
will  not  come  to  Mahomet,  Mahomet  is  going  to  the 
mountain  ;  or,  in  other  words,  that  since  you  cannot 
raise  your  stock  to  your  subscriptions,  you  are  prudently 
bringing  down  your  subscriptions  to  your  stock.  I 
confess  that  I  was  always  afraid  that  the  British  South 
Sea  was  growing  a  monster  too  big  for  all  the  money 
in  Europe  to  support :  and  that  such  a  prodigious  leap 
as  from  a  subscription  of  £400  to  one  of  £1,000  had  left 
such  a  gap  in  the  building  as  would  one  time  or  other 
bring  it  to  the  ground  ;  but  I  hope  and  believe  that  the 
wise  and  prudent  measures  you  are  now  taking  will 
make  the  whole  plan  so  firm  and  solid,  so  uniform  and 
consistent  with  itself,  that  it  may  for  the  future  despise 
the  attempts  of  all  its  enemies.5 

Budgell  then  touched  on  a  subject,  which  several  of 
the  managers  of  the  Corporation  would  rather  he  had 
ignored.  4 1  believe,5  he  continued,  4  there  has  been  a 
great  deal  of  art,  a  great  deal  of  industry,  used  by  ill- 
designing  men  to  beat  down  the  stock  to  the  price  it  now 
bears  ;  but  the  most  artful  story,  the  most  malicious 
falsehood,  that  our  enemies  have  given  out  is,  that  two 
or  three  of  our  very  Directors,  that  some  of  our  own 
body,  have  basely  betrayed  the  trust  reposed  in  them, 
and  have  been  the  chief  causes  of  the  present  confusions. 
I  confess  that  I  can  never  believe  that  men,  who  have 
had  the  honour  to  be  entrusted  with  the  fortunes  of 
so  many  of  their  fellow-subjects,  could  engage  in  so 
base  a  design.  The  present  circumstances  of  things 
have  made  the  place  of  a  Director  of  the  South  Sea 
Company  a  post  of  as  much  consequence  as  any  perhaps 
in  the  administration  of  public  affairs  ;  and  it  is  very 
certain  men  in  this  post  might,  if  they  were  wicked 


THE  ‘SLUMP5 


129 


enough,  get  a  great  deal  of  money  at  the  expense  of 
those  who  trusted  them  ;  but  should  any  offer  to  raise 
an  overgrown  fortune  by  so  scandalous  a  method,  it  is 
impossible  to  think  they  would  be  safe  in  the  enjoyment 
of  it.  They  might,  indeed,  buy  large  estates  and  gilt 
chariots,  but  I  believe  they  would  scarce  venture  to 
ride  in  them  through  the  streets  of  London.  I  have 
only  touched  upon  this  to  show  how  unlikely,  how 
improbable,  a  falsehood  the  malice  of  our  enemies  has 
invented.5 

This  could  not  be  allowed  to  pass  unnoticed,  and 
Robert  Chester  took  up  the  challenge  on  behalf  of  his 
co-Directors.  4 1  know  of  no  proceedings  among  the 
Directors,5  he  declared,  4  but  what  have  been  intended 
for  the  good  of  the  whole  Company.  For  my  part  I 
have  not  sold  any  of  my  stock,  nor  reserved  to  myself 
any  more  of  the  subscriptions  than  was  allowed  to  each 
of  the  Directors.  My  fortune  would  have  been  as  large, 
if  I  had  not  been  a  Director.  As  to  the  great  gap 
between  the  second  and  third  subscription  in  money, 
which  is  objected  to  as  a  wrong  step  in  the  management 
of  the  Company’s  affairs,  I  can  assure  you  that  it  is 
none  of  the  Directors5  fault,  since  they  designed  to  have 
made  the  third  subscription  at  £500  or  £600  ;  but  the 
humour  and  eagerness  of  the  people  having  run  up  the 
South  Sea  stock  to  £700  or  £800,  the  Directors  could 
not  in  prudence  have  opened  a  subscription  at  less  than 
£1,000. 5  While  this  was  satisfactory  as  far  as  it  went, 
it  was  noted  with  dismay  that  none  of  Chester’s  col¬ 
leagues  took  the  opportunity  to  clear  themselves.  As 
for  Chester,  who  came  forward  to  protest  against  any 
suspicion  being  cast  upon  him,  when  the  affairs  of  the 
Company  were  investigated  it  was  proved  that  he  was 
one  of  the  w’orst  offenders. 


K 


130 


THE  SOUTH  SEA  BUBBLE 


The  long-threatened  disaster  now  descended  upon 
the  Company.  c  Most  people  thought  it  would  come,  but 
no  man  prepared  for  it ;  no  man  considered  it  would 
come  like  a  thief  in  the  night ;  exactly  as  it  happens  in 
the  case  of  our  birth,’  Pope  1  wrote  to  the  Bishop  of 
Rochester, 2  September  23.  ‘  Methinks  God  has  punished 
the  avaricious,  as  He  often  punishes  sinners  in  their  own 
way,  in  the  very  sin  itself ;  the  thirst  of  gain  was  their 
crime  :  that  thirst  continued  became  their  punishment 
and  ruin.  As  for  those  few  who  have  the  good  fortune 
to  remain  with  half  of  what  they  imagined  they  had  (among 
whom  is  your  humble  servant),  I  would  have  them  sen¬ 
sible  of  their  felicity  and  convinced  of  the  truth  of  old 
Hesiod’s  maxim,  who,  after  half  his  estate  was  swal¬ 
lowed  up  by  the  directors  of  those  days,  resolved  that 
half  to  be  more  than  the  whole.’  3  Further  particulars 
of  the  catastrophe  are  supplied  in  a  letter,  dated  Sep¬ 
tember  27,  written  by  Arthur  Brodrick  to  Lord  Middle- 
ton  :  6  The  Company  have  yet  come  to  no  determination, 
for  they  are  in  such  a  wood  that  they  know  not  which 
way  to  turn,  but  it  is  given  out  (I  suppose  by  direction) 
that  they  will  lower  the  price  of  the  Third  and  Fourth 
Subscriptions,  and  offer  more  reasonable  terms  to  the 
redeemables,  leaving  to  their  option  the  acceptance,  or 
return,  of  their  several  securities,  these  to  remain  on 
the  foot  they  are  till  discharged  by  payment  in  money. 
No  doubt  at  first  they  expected  nothing  less,  but  as 
Mr.  Budgell  told  them  in  the  General  Court,  since  the 
mountain  would  not  come  to  Mahomet,  he  must  go  to 
the  mountain.  You  misunderstood  me  in  thinking  I 

1  Alexander  Pope  (1688-1744),  the  poet. 

2  Francis  Atterbury  (1662-1732),  Bishop  of  Rochester  from 
1713. 

3  Pope  :  Works  (ed.  El  win  and  Courthope),  V.,  185. 


THE  ‘SLUMP5 


131 


expected  a  speedy  dissolution.  That  had  been  con¬ 
sidered  and  laid  aside,  notwithstanding  which,  as  earnest 
application  was  everywhere  making,  as  if  elections  were 
to  begin  within  a  month.  This  was  begun  by  the  South 
Sea  men,  and  great  sums  have  they  already  spent,  but, 
if  I  mistake  not,  they  will  meet  with  more  disappoint¬ 
ments  than  they  expected ;  for,  by  several  gentlemen 
lately  come  to  town,  I  perceive  the  very  name  of  a 
South  Sea  man  grows  abominable  in  every  country. 
Your  remark  is  very  just,  that  if  this  great  Leviathan 
intended  to  have  been  directors  of  the  whole  national 
affairs  as  well  as  of  the  Company  do  fall,  it  will  neces¬ 
sarily  occasion  such  a  convulsion  as  no  honest  man 
desires  ;  but  I  think  there  remains  a  middle  way  between 
the  two  extremes,  by  supporting  their  credit,  as  far  as 
in  reason  it  ought  to  be  supported,  distinguishing  be¬ 
tween  what  ought  properly  to  be  called  credit  and 
chimerical  calculations,  and  the  one  is  certainly  prac¬ 
ticable  without  running  into  the  other.  A  great  many 
goldsmiths  are  already  gone  off,  and  more  will  daily. 
I  question  whether  one-third,  nay,  a  fourth,  can  stand 
it ;  the  cause  of  which  is  this  :  those  who  had  either 
originally,  or  by  buying  with  money  got  by  taking 
differences,  run  into  pretty  considerable  quantities  of 
stock,  not  being  therewith  content,  but  resolving  to  sit 
down  with  nothing  less  than  hundred  thousands,  in 
order  to  obtain  which,  gave  vast  premiums  to  the  gold¬ 
smiths  for  money,  pawning  their  stock,  some  at  four, 
others  at  five  and  six  hundred,  this  being  looked  upon 
as  good  as  land  security  :  the  money  thus  lent  was  in 
cash  notes,  which,  whilst  paper  had  credit,  answered  the 
end  as  well  as  specie  ;  but  as  soon  as  a  run  was  upon 
them,  they  found  (by  reason  of  their  stocks  sinking) 
their  pledges  would  not  produce  cash  to  answer  their 


132 


THE  SOUTH  SEA  BUBBLE 


notes,  and  thus  one  after  another  they  are  every  day 
going  off.  From  the  very  beginning,  I  founded  my 
judgment  of  the  whole  affair  upon  this  unquestionable 
maxim,  that  ten  millions  (which  is  more  than  our  run¬ 
ning  cash)  would  not  circulate  more  than  two  hundred 
millions,  beyond  which  our  paper  credit  extended ; 
that  therefore,  whenever  that  should  become  doubtful, 
be  the  cause  wThat  it  would,  our  noble  state  machine 
must  inevitably  fall  to  the  ground,  or  at  best  be 'brought 
within  so  much  a  narrower  compass  than  what  was 
projected,  that  our  most  sanguine  people  would  find 
more  appositely  expressive  of  their  vain  hopes  than 
Parturiunt  montes,  nascetur  ridiculus  mus.  I  endea¬ 
voured,  with  an  honest  and  friendly  intention,  to  per¬ 
suade  as  many  of  my  friends  as  I  conversed  with,  to 
secure  the  main  chance,  and  not  dip  (at  least)  out  of 
their  depth,  in  case  they  should  resolve  to  go  with  the 
current.  Some  few  were  prevailed  upon  by  such  argu¬ 
ments  as  I  thought  well  founded,  whose  hearty  thanks 
and  acknowledgments  I  have  received  ;  but  the  far 
greater  concluding  (as  I  must  own  I  did)  that  the  thing 
would  have  been  carried  on  for  some  longer  time  have, 
on  this  supposition,  run  themselves  aground,  which  they 
dearly  repent.  Into  this  they  were  generally  led  by 
assurances  from  the  gent,  whose  nose  bled  [Lord  Sunder¬ 
land],  and  who  himself  was  certainly  duped  by  the  honest 
Directors  from  whom  he  received  information,  while 
they  were  all  the  time  (understand)  selling  out  as  fast 
as  they  could.  That  he  was  duped  I  think  past  doubt, 
from  his  having  by  his  influence  brought  all  his  particular 
friends,  and  even  his  own  family  and  nearest  relations, 
so  far  into  the  mire  as  that  few  of  them  will,  during 
their  lives,  surmount  the  loss  ;  and  others  of  them  are 
so  totally  undone  as  to  be  beyond  possibility  of  re- 


THE  4  SLUMP ’ 


133 


trieving  it.  Possibly,  before  the  end  of  next  session,  I 
may  be  called  a  South  Sea  man,  for  I  shall  not  join  with 
those  whose  losses  have  so  far  exasperated  them,  as  to 
be  desirous,  out  of  revenge,  to  run  into  extremes  which 
may  endanger  the  nation.’  1 

At  a  General  Court  held  on  September  30  everything 
that  was  possible  was  done  to  stay  the  panic.  Sir 
John  Fellowes  stated  definitely  that,  in  pursuance  of 
the  powers  given  at  the  last  meeting,  they  had  come 
to  an  agreement  with  the  Bank,  under  which  the  latter 
corporation  would  accept  stock  at  £400,  in  lieu  of 
£3,775,000  due  to  it  at  Ladyday  and  Michaelmas  in  the 
following  year.  He  also  announced  that,  by  way  of 
relief,  great  concessions  would  be  made  to  the  proprie¬ 
tors  of  the  redeemable  annuities  and  other  funds.  4  The 
Directors,’  he  said,  4  have  agreed  to  admit  them  at  £400 
per  cent.,  allowing  the  Midsummer  dividend,  and  taking 
in  the  annuities  at  par.  They  will  give  the  long  annui¬ 
ties  thirty-two  years’  purchase ;  and  the  proprietors 
of  the  Nine-per-cent,  and  the  Lottery  of  1710  seventeen 
years’ purchase.  The  Second  Money- Subscription  would 
be  made  equal  to  the  First,  and  the  Third  and  Fourth 
would  be  lowered  to  £400  per  cent,  each,  allowing  them 
the  Midsummer  dividend. 

This  was  generally  approved,  and  no  one  welcomed 
it  more  heartily  than  James  Craggs  the  elder.  4  Many 
causes  have  been  assigned  of  the  present  calamity,’  he 
remarked  ;  4  but  I  doubt  whether  the  true  one  is  yet 
known.  It  is  plain  the  Company  has  a  great  many 
enemies,  and  that  many  persons  have  been  sent  about 
to  raise  jealousies.  It  is  certain  a  general  distrust,  a 
general  consternation,  has  been  spread  among  the  people ; 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  191. 


134 


THE  SOUTH  SEA  BUBBLE 


but  I  hope  that  all  things  will  now  be  well,  and  that 
everybody  will  have  reason  to  be  satisfied  since  the  Com¬ 
pany  is  joined  to  the  Bank,  which  has  always  supported 
the  public  credit.  Those  who  have  sold  out  their  stock 
at  high  prices  ought  now  to  come  in  and  support  it,  and 
I  doubt  not  but  they  will  do  so  ;  but  be  it  at  their  peril 
if  they  do  not,  for  it  is  not  locking  up  our  money  that 
can  now  give  security.  No,  every  man  in  England  is 
concerned,  and,  for  my  part,  I  would  not  be  seen  at 
such  a  time  as  this  to  have  more  money  by  me  than 
will  pay  for  a  week’s  expenses.’  The  applause  which 
greeted  these  noble  sentiments  may  well  be  imagined. 
It  was  not  for  some  months  that  it  became  known  that 
the  man  who  would  only  keep  the  cash  for  a  week’s 
expenses  in  hand,  estimated  those  expenses  on  a  generous 
scale,  since  he  retained  about  a  million  and  a  half 
sterling. 

The  only  comfort  which  Budgell,  who  spoke  after 
Craggs,  could  find  in  the  state  of  affairs  was  that 
the  French  were  in  the  same  parlous  condition.  Sir 
Gilbert  Heathcote,  who  spoke  briefly,  seemed  to  indicate 
that  if  Providence  would  interest  itself  in  the  South  Sea 
Company  the  storm  might  be  weathered.  A  Mr.  Walker 
inclined  to  the  view  that  Heaven  helps  those  who  help 
themselves,  and  evidently  thought  the  time  had  come 
for  the  proprietors  to  look  after  themselves.  4  I  look 
with  the  utmost  concern  on  the  calamity  of  my  country, 
and  I  am  not  palliating  the  actions  of  those  who  have 
ruined  us,  but  for  bringing  them  to  justice.  A  time 
will  come  to  name  them.’  This  was  the  first  time  such 
a  thing  had  been  said,  and  several  men  there  must 
have  shivered  at  the  thought  that  this  cry  for  retribution 
would  find  an  echo  in  many  breasts.  4  By  our  law,’ 
Walker  continued,  4  it  is  criminal  for  a  man  who  is 


THE  4  SLUMP  5 


135 


robbed  to  compound  the  felony  in  order  to  have  his 
goods  restored  him.  It  is  the  same  thing  to  me 
whether  I  am  plundered  by  a  cabal  of  sharpers  and 
their  adherents  in  a  committee  or  by  a  troop  of  horse 
at  Newmarket.  I  had  none  of  the  Third  Subscription, 
but  the  contracts  for  it  have  been  the  undoing  of  the 
nation.  I  am  sorry  to  see  great  estates  acquired  by 
miscreants  who,  twelve  months  ago,  were  not  fit  to  be 
valets  to  the  gentlemen  they  have  ruined.  This,  indeed, 
is  not  a  court  of  accusation  but  a  court  of  resolution, 
and  therefore  (though  I  do  not  know  if  it  will  be  seconded) 
I  move,  “  That  a  Committee  be  appointed  to  address 
the  Parliament,  to  bring  to  justice  the  betrayers  of  their 
country.55  5 

The  sensation  created  by  this  speech  must  have  been 
enormous,  nor  could  it  have  been  lessened  when  Captain 
Maggot  stated  that  it  was  within  his  knowledge  that  one 
of  the  Directors  had  sold  about  £50,000  of  the  Third 
Subscription  at  £230  per  cent,  premium ;  and  when 
called  upon  by  several  persons  to  give  the  name,  said — 
Ambrose  Page.  The  silence  that  followed  this  direct 
accusation  was  broken  by  Budgell  rising  to  discuss 
another  matter  ;  but  there  can  be  no  doubt  that  the 
meeting  was  reflecting  upon  the  charges  brought  against 
the  managers  of  the  corporation.  Director  after  Director 
rose  and  spoke  anent  the  aspersions  that  had  been  cast 
upon  the  body  of  which  they  were  members.  Robert 
Chester  and  William  Astell  said  that  they  would  wel¬ 
come  the  appointment  of  such  a  Committee  as  Walker 
desired.  Sir  Harcourt  Master  declared  himself  desirous 
of  the  strictest  enquiry,  which  he  did  not  doubt  would 
turn  to  the  honour  of  the  Directors,  and  he  defied  man¬ 
kind  to  prove  that  he  had  made  a  single  contract. 
Arthur  Ingram  spoke  in  defence  of  himself  and  his 


136 


THE  SOUTH  SEA  BUBBLE 


brethren,  and  gave  the  assurance  that  upon  the  best 
observation  he  had  been  able  to  make,  he  had  found 
nothing  among  them  but  a  hearty  zeal  for  the  public 
good.  After  these  Directors  had  spoken,  other  pro¬ 
prietors,  including  the  elder  Craggs  and  Lord  Islay,1 
deprecated  the  promulgating  of  indefinite  accusations 
at  such  a  time  and  place,  and  the  matter  dropped  for 
the  moment,  all  realising  that  the  great  thing  at  the 
moment  was  to  reassure,  not  to  alarm,  the  public. 

On  the  strength  of  the  statement  that  the  Bank  would 
take  £3,700,000  of  South  Sea  stock  at  £400  per  cent., 
the  price  rose  from  £130  to  £320,  but  it  fell  again  when 
the  Bank  found  it  impossible  to  proceed  with  the  scheme. 
4  When  the  proposition,’  it  announced,  4  was  offered  by 
the  Lords,  at  a  meeting  of  the  Committees  of  both 
Companies,  as  a  suitable  expedient  for  the  support  of 
public  credit,  the  Court  of  the  Directors  of  the  Bank 
showed  their  readiness  to  join  in  any  measures  that 
might  tend  to  the  service  of  the  public.  But,  some 
difficulties  appearing  to  the  Committee  of  the  Bank, 
they  have  advised  with  their  council,  and  they  are 
advised  that,  considering  the  nature  of  this  transaction, 
it  will  not  be  safe  for  them  to  proceed  upon  the  propo¬ 
sition  without  consent  of  Parliament.  However,  they 
think  it  reasonable  that,  in  the  meantime,  the  Committee 
of  the  South  Sea  should  give  the  Committee  of  the  Bank 
some  account  of  their  estate,  for  the  satisfaction  of  their 
principals.’  The  4  difficulties  ’  to  which  it  alluded  were 

1  Archibald  Campbell  (1682-1761),  younger  son  of  Archibald 
Campbell,  first  Duke  of  Argyle  ;  created  Earl  of  Islay,  1706  ; 
elected  representative  Peer  of  Scotland ;  Lord  Register  of 
Scotland,  1714  ;  Lord  Keeper  of  the  Privy  Seal  in  Scotland, 
1721  ;  succeeded  his  brother  John  as  third  Duke  of  Argyle, 
1743.  He  was  a  heavy  investor  in  the  Mississippi  Company,  and 
a  great  admirer  of  John  Law. 


THE  4  SLUMP  ’ 


137 


several.  The  fall  of  the  stock  to  £175  ;  the  fact  that  the 
Company’s  bonds  were  sold  at  a  discount  of  twenty-five 
per  cent.  ;  the  consequent  run  on  the  goldsmiths,  who, 
unable  to  meet  their  liabilities,  absconded  ;  the  bank¬ 
ruptcy  of  the  Sword-blade  Company  ;  and  the  entire 
dislocation  of  credit.  4 1  did  not  write  to  you  by  last 
post,  my  dear  Lord,’  Matthew  Prior  wrote  on  October  3 
to  Lord  Harley,  4  for  everything  was  in  such  confusion 
as  to  the  pecuniaries  in  ’Change  Alley  and  South  Sea, 
that  I  did  not  know  what  to  say ;  but  the  confusion 
still  remains,  and  I  must  be  longer  silent,  I  find,  if  I 
stay  till  I  know  what  to  write  on  that  subject :  all  is 
floating,  all  falling,  the  Directors  are  curst,  the  top 
adventurers  broke,  four  goldsmiths  walked  off,  Walpole 
and  Townshend  sent  for,  that  they  may  settle  matters  ; 
sed  adhuc  sine  successu :  and  every  man  with  a  face  as 
long  as  a  Godolphin’s  ;  vogue  la  galere  ;  I  must  fare  like 
the  rest.’ 1 


1  Bath  MSS.,  III.,  490. 


CHAPTER  VI 


The  Nation  in  Distress 

OCTOBER-NOVEMBER,  1720 

IT  cannot,  with  any  degree  of  accuracy,  be  stated  that 
the  action  of  the  Bank  brought  about  the  catas¬ 
trophe,  though  Directors  of  the  South  Sea  Company, 
in  the  hope  of  saving  their  faces,  did  not  hesitate  to 
declare  that  this  was  the  case  ;  nor  can  it  even  be  held 
to  have  precipitated  it,  because  clearly  the  Bank’s 
action  was  the  result  of  it,  and  not  the  cause.  The 
catastrophe,  indeed,  was,  for  the  reasons  given  in 
earlier  chapters,  inevitable.  South  Sea  stock,  so  lately 
quoted  at  £1,000,  had,  on  September  2,  fallen  to 
£750  ;  eleven  days  later  it  stood  at  £590,  on  Octo¬ 
ber  3  it  was  listed  at  £280,  and  on  October  11  at 
£240. 

The  outcry  was  terrible.  It  is  almost  impossible 
to-day  to  realise  the  wave  of  anger  which  then  over¬ 
whelmed  almost  the  entire  upper  and  middle  classes 
throughout  the  country.  The  demand  for  vengeance, 
for  condign  punishment  of  the  offenders,  was  universal. 
Petitions  to  Parliament  were  prepared  in  every  part  of 
the  country,  from  the  City  of  London  to  a  borough  so 
inconsiderable  as  Chipping  Wycombe. 

‘  The  miscarriage  of  the  South  Sea  has  sunk  all  credit 

138 


'>.V 


t- 139 


THE  NATION  IN  DISTRESS 


139 


at  home  and  abroad,’ 1  Whitelocke  Bulstrode  2  wrote  to 
Peter  le  Neve  3 ;  and  certainly  the  credit  of  individuals 
at  home  was  at  a  very  low  ebb.  Indeed,  no  man’s 
reputation  was  safe,  and  slander  was  as  busy  with  the 
innocent  as  with  the  guilty.  The  wildest  rumours  were 
afloat.  4 1  am  assured  that  there  are  one  hundred  and 
thirty-eight  members  of  the  House  of  Commons  who 
have  borrowed  money  of  the  South  Sea  Company. 
These  are  preparing  a  law  to  exempt  themselves  from 
these  debts  by  a  composition  of  ten  per  cent.,’  4  Erasmus 
Lewis  wrote  to  Lord  Oxford.  Perhaps  this  was  in  the 
mind  of  William  Stratford  when  he  wrote  to  Edward 
Harley,  junior  :  4  If  our  reports  hold  true  we  shall  have 
some  sport.  Our  patriots  are  said  to  be  upon  an 
Herculean  labour  of  cleansing  their  own  house.  The 
Augean  stable  was  not  filthier.’  Dr.  Stratford  then  con¬ 
descended  to  personalities.  4  Should  truth  come  out,’ 
he  said,  4  the  Attorney  5  would  appear  to  have  no  little 
share.  But  though  he  was  in  early,  and  had  stock 
at  a  very  low  rate,  yet  I  fancy  he  was  cautious  enough 
to  pay  for  what  he  had.  That  may  exempt  him  from 
the  censure  others  may  have,  though  not  from  the 

1  October  19,  1720  ;  Bath  MSS.,  II.,  181. 

2  Whitelocke  Bulstrode,  of  Hounslow,  Middlesex  (1650- 
1724),  a  Commissioner  of  Excise,  1710-1715  ;  author  of  ‘  A 
Discourse  on  Natural  Philosophy,’  etc. 

3  Peter  le  Neve  (1661-1729),  President  of  the  Antiquarian 
Society,  1687-1724. 

4  June  20,  1721  ;  Portland  MSS.,  V.,  622. 

5  Nicholas  Lechmere  (1675-1727),  Solicitor-General,  1714- 
1718  ;  Attorney- General,  1718  ;  appointed  for  life  in  1718 
Chancellor  of  the  Duchy  of  Lancaster.  He  resigned  the  office 
of  Attorney- General  on  May  7,  1720.  He  was  raised  to  the 
peerage  in  the  following  year.  He  had  married  Lady  Elizabeth 
Howard  (cl.  1727),  daughter  of  Charles  Howard,  third  Earl  of 
Carlisle. 


140 


THE  SOUTH  SEA  BUBBLE 


guilt.’ 1  Suspicion  certainly  casts  its  shadow  on  the 
Attorney-General.  ‘  As  for  Mr.  Lechmcre,’  Lady  Irvine 2 
wrote  to  her  father,  Lord  Carlisle,  February  11,  1721, 

4  the  town  will  have  it  his  illness  is  political ;  he  has 
very  seldom  attended  the  Secret  Committee,3  and  spoke 
very  seldom  in  the  House,  but  talks  very  high  out  of  it. 
You  know  he  is  so  little  beloved  that  I  believe  he  has 
many  undeserved  reflections  cast  upon  him.  ’Tis  said 
Mr.  Knight’s4  going  off  is  very  serviceable  to  him, 
since  there  would  have  been  some  discoveries  made  not 
much  to  his  honour  had  Knight  stayed.’ 5  People 
would  not  hold  him  innocent,  though  no  evidence,  other 
than  hearsay,  was  adduced.  4 1  have  one  secret  I  can 
let  you  into,’  Dr.  Stratford  further  informed  Edward 
Harley,  junior,  on  June  23.  4  When  South  Sea  stock 

was  fallen,  the  Company  itself  took  off  the  greatest  part 
of  the  Attorney’s  stock  at  £600  ;  some  was  left  in  to 
keep  up  a  show  as  though  he  had  not  sold.  You  see  now 
the  reason  of  his  concern  for  them,  and  he  had  from  the 
Government  ail  the  money  that  he  put  in  there.  It  is 
a  pity  but  these  things  were  more  known.’ 6 

With  more  of  reason,  all  the  Directors,  without  dis¬ 
tinction,  were  condemned  by  public  opinion.  4  Mon¬ 
sters  of  pride  and  covetousness  ’  and  4  infamous  betrayers 
of  the  country,’  they  were  styled  in  petitions  to  Parlia¬ 
ment.  It  was  scarcely  safe  for  any  of  them  to  show 

1  January  31,  1721  ;  Portland  MSS.,  VII.,  288. 

2  Anne  (b.  1696),  daughter  of  Charles  Howard,  third  Earl  of 
Carlisle,  married  Richard  Ingram,  Viscount  Irvine  (1688-1721), 
Colonel  of  the  Life  Guards. 

3  See  supra  pp.  204-219. 

4  The  absconding  cashier  of  the  South  Sea  Company. 

5  Carlisle  MSS.,  30. 

6  Portland  MSS.,  VII.,  299. 


THE  NATION  IN  DISTRESS 


141 


themselves  out  of  doors.  4  There  were  papers  dropped 
about  the  Court,’  Lady  Irvine  wrote  to  Lord  Carlisle, 
referring  to  the  General  Court  held  at  the  South  Sea 
House  in  December,  4  to  desire  every  honest  gentleman 
not  to  sit  near  the  Directors  for  fear  of  accidents,  and  I 
believe,  had  they  proposed  giving  out  the  receipts  at 
1,000,  there  had  been  a  great  deal  of  mischief  done,  for 
there  were  several  people  went  with  pocket  pistols  and 
prepared  to  use  them,  if  the  proposition  I  mentioned 
before  had  been  named.’  1  Indeed,  the  general  feeling 
was  such  that  it  became  the  practice  among  ladies  who, 
at  the  card-table,  turned  up  a  knave,  to  cry,  4  There’s  a 
Director  for  you.’  Pamphlets  summarising  their  ini¬ 
quities  wTere  widely  circulated,  and  newspapers  pub¬ 
lished  articles  demanding  their  heads  on  a  charger. 
Ballads,  full  of  vituperation,  were  written  about  them, 
and  hot  from  the  press  came  cartoons  holding  them  up 
to  obloquy. 

Although  caricatures,  mostly  of  an  emblematical 
character,  had  from  time  to  time  been  published  in  the 
country,  it  was  only  at  this  period  that  they  began  to 
get  common.  The  mania  for  speculation  in  France  and 
Holland  had  resulted  in  a  large  number  of  satirical 
drawings,  and  these  were  collected  in  1720,  and  pub¬ 
lished  in  a  folio  volume,  under  the  title,  4  Het  groote 
Taferel  derDwaaskeid  ’  (‘The  Great  Picture  of  Folly  ’). 
The  early  English  cartoon,  4  The  Bubblers  Bubbed,  or, 
The  Devil  take  the  Hindmost,’  which  has  for  its  subject 
the  suppression  of  the  unauthorised  companies,  is  adver¬ 
tised  on  the  Post-Boy  for  June  21,  1720.  Another, 
4  The  World  in  Masquerade,’  is  advertised  on  February 
29,  and  claims  to  contain  4  nigh  eighty  figures.’  In 
April  is  announced  a  series  of  4  six  fine  prints,  repre- 
1  December  24,  1720  ;  Carlisle  MSS.,  20. 


142 


THE  SOUTH  SEA  BUBBLE 


senting  the  humours  of  the  French,  Dutch,  and  English 
bubblers  and  stock-jobbers,  with  a  variety  of  humours, 
etc.’  Hogarth’s  first  political  caricature  relates  to  the 
‘  bubbles,’  and  is  entitled,  ‘  An  Emblematical  Print  on 
the  South  Sea  Scheme.’  In  this  is  shown  a  street  at 
the  foot  of  the  London  Fire  Monument,  the  pedestal  of 
which  is  decorated  with  statues  of  two  foxes  (typifying 
the  Directors),  and  inscribed,  4  This  monument  was 
erected  in  memory  of  the  destruction  of  this  city  by  the 
South  Sea  in  1720.’  The  various  figures  are  marked 
with  letters,  which  are  explained  in  the  following 
lines  : — 

4  See  here  the  causes  why  in  London 
So  many  men  are  made  and  undone, 

That  arts  and  honest  tradings  drop 
To  swarm  about  the  devil’s  shop.  (A) 

Who  cuts  out  (B)  fortune’s  golden  haunches, 
Trapping  their  souls  with  lots  and  chances, 

Sharing  ’em  from  Blue  Garters  down 
To  all  blue  aprons  in  the  town. 

Here  all  religions  flock  together, 

Like  tame  and  wild  fowl  of  a  feather, 

Leaving  their  strife  religious  bustle 
Kneel  down  to  play  at  pitch  and  hustle,  (C) 

Thus  when  the  shepherds  are  at  play 
Their  flocks  must  surely  go  astray  ; 

The  woeful  cause  that  in  these  times 
(E)  Honour  and  (D)  honesty  are  crimes 
That  publicly  are  punished  by 
(G)  Self-interest  and  (F)  villainy. 

So  much  for  money’s  magic  power  : 

Guess  at  the  rest  you’ll  find  out  more.’ 

Another  print,  4  Lucifer’s  New  Row-boat,’  has  the 
following  apostrophe  to  the  Directors  : — 

4  Go  on,  vile  traitors  !  glory  in  your  sins, 

And  grow  profusely  rich  by  wicked  means  ; 

Ruin  your  country  for  your  own  by-ends, 

Cozen  your  neighbours,  and  delude  your  friends  ; 


THE  NATION  IN  DISTRESS 


143 


Despise  religion,  ridicule  her  rules, 

And  laugh  at  conscience,  as  the  guide  of  fools  ; 
Impoverish  thousands  by  some  public  fraud, 

And  worship  interest  as  your  only  God  : 

Thus  may  you  gain,  in  time,  a  South  Sea  coach, 

And  ride  through  London,  loaded  with  reproach  ; 
Become  a  proud  Director,  and  at  last 
Be  bound  to  render  what  you  got  so  fast  ; 

Perhaps  be  punish’d  when  your  all  is  lost, 

With  gallows,  pillory,  or  whipping-post  ; 

Or,  if  you  save  your  gold,  be  doom’t  to  float, 

To  Hell  in  this  infernal  ferry-boat, 

Built  at  the  devil’s  cost,  now  stock  is  low, 

To  waft  Directors  downwards,  downwards,  ho  !  ’ 

A  third,  1  Britannia  stript  by  a  South  Sea  Director,’ 
presents  Britannia,  saying,  4  Will  you  ne’er  have  done 
fleecing  me  ?  ’  and  a  Director,  giving  her  a  small  purse 
in  exchange  for  a  large  one,  and  replying,  4  It  is  all  for 
your  good.’  In  the  distance  is  a  ship,  waiting  presum¬ 
ably  to  take  him  abroad.  Below  are  the  lines  : — 

‘  See  how  a  crafty  vile  projector  picks 
Britannia’s  purse  by  South  Sea  shams  and  tricks  ; 
Drains  her  of  wealth  till  he  has  made  her  mourn, 

And  humbly  cheats  her  with  a  false  return  ; 

Takes  much,  leaves  little  for  her  own  support ; 

Gives  her  fair  words,  but  all  he  says  comes  short ; 
Conveys  her  riches  to  a  distant  shore, 

And  daily  courts  the  silly  dame  for  more.’ 

The  disaster  is  brought  in  touch  with  literature  by  a 
print,  entitled, 4  An  Epilogue  spoke  to  a  play  called  44  The 
Alchemist,”  5  published  when  that  play  was  revived  at 
Drury  Lane  in  October,  1721.  The  4  Epilogue  ’  ran  : — 

‘  Old  surly  Ben  1  to-night  hath  let  us  know 
That  in  this  isle  a  plenteous  crop  did  grow 
Of  knaves  and  fools  a  hundred  years  ago  : 


1  Ben  Jonson. 


144 


THE  SOUTH  SEA  BUBBLE 


Chemists,  bawds,  gamesters,  and  a  numerous  train 
Of  humble  rogues,  content  with  moderate  gain  ; 

The  Poet,  had  he  liv’d  to  see  this  age, 

Had  brought  sublimer  villains  on  the  stage. 

Our  knaves  sin  higher  now  than  those  of  old, 
Kingdoms,  not  private  men,  are  bought  and  sold. 
Witness  the  South  Sea  project,  which  hath  shown 
How  far  philosophers  may  be  outdone 

By  modern  -  men  that  have  found  the  stone. 

Well  might  it  take  its  title  from  the  main 
That  rose  so  swift  and  sunk  so  soon  again. 

Fools  have  been  always  bit  by  artful  lies, 

But  here  the  cautious  were  deceiv’d  and  wise  ; 

And  yet,  in  these  flagitious  monstrous  times, 

The  knaves  detected  triumph  in  their  crimes, 

Wallow  in  wealth,  have  all  things  at  command, 

And  brave  the  vengeance  of  an  injur’d  land. 

Well !  since  we’ve  learn’d  experience  at  our  cost, 

Let  us  preserve  the  remnant  not  yet  lost, 

Though  L[a]w  from  France  be  landed  on  the  coast. 

By  sober  arts  aspire  to  guiltless  fame, 

And  prove  that  virtue’s  not  an  empty  name.’ 

Swift,  too,  fanned  the  outcry,  and  damned  the  Direc¬ 
tors  for  all  time  in  1  The  South  Sea  Project 5 : — 

‘  Directors,  thrown  into  the  sea, 

Recover  strength  and  vigour  there  ; 

But  may  be  tamed  another  way, 

Suspended  for  a  while  in  air. 

‘  Directors  !  for  ’tis  you  I  warn, 

By  long  experience  we  have  found 
What  planet  ruled  when  you  were  born  ; 

We  see  you  never  can  be  drown’d. 

*  Beware,  nor  overbulky  grow, 

Nor  come  within  your  cully’s  reach  ; 

For,  if  the  sea  should  sink  so  low 
To  leave  you  dry  upon  the  beach, 

‘  You’ll  owe  your  ruin  to  your  bulk  : 

Your  foes  already  waiting  stand, 

To  tear  you  like  a  founder’d  hulk, 

While  you  lie  helpless  on  the  sand. 


THE  NATION  IN  DISTRESS 


145 


‘  Thus,  when  a  whale  has  lost  the  tide, 

The  coasters  crowd  to  seize  the  spoil  : 

The  monster  into  parts  divide. 

And  strip  the  bones,  and  melt  the  oil. 

‘  Oh  !  may  some  western  tempest  sweep 
These  locusts  whom  our  fruits  have  fed, 

That  plague,  directors,  to  the  deep, 

Drawn  from  the  South  Sea  to  the  Red  ! 

*  May  He,  whom  Nature’s  laws  obey, 

Who  lifts  the  poor,  and  sinks  the  proud, 

“  Quiet  the  raging  of  the  sea, 

And  still  the  madness  of  the  crowd  !  ” 

*  But  never  shall  our  isle  have  rest, 

Till  those  devouring  swine  run  down, 

(The  devils  leaving  the  possest) 

And  headlong  in  the  waters  drown. 

*  The  nation  then  too  late  will  find, 

Computing  all  this  cost  and  trouble, 

Directors’  promises  but  wind, 

South  Sea,  at  best,  a  mighty  bubble.’ 

While  no  terms  were  too  harsh  with  which  to  brand 
the  Directors  and  their  associates,  no  one  in  authority 
ventured  even  to  hint  that  the  public  were  at  least  as 
much  to  blame  for  their  own  losses.  It  was  as  much  as 
any  statesman’s  place  was  worth — it  would  certainly 
have  cost  him  for  all  time  his  popularity — to  suggest 
at  this  moment  that  the  disaster  had  been  brought 
about  as  much  by  the  people’s  ridiculous  credulity  and 
greedy  avarice  as  by  the  frauds  of  the  promoters.  If 
persons  in  high  places  preserved  a  discreet  silence,  some 
others,  it  must  be  confessed,  were  at  no  pains  to  hide 
their  contempt  for  those  who  had  failed  in  their  attempts 
to  get  rich  quickly,  and  pamphlets  and  squibs  and  songs 
were  published  in  great  number.  Very  popular — among 
those  who  were  unaffected  by  the  catastrophe — were 
ballads,  published  at  this  time,  treating  of  the  collapse 
of  the  Company. 


14G 


THE  SOUTH  SEA  BUBBLE 


A  SOUTH-SEA  BALLAD 

Or,  MERRY  REMARKS  UPON  EXCHANGE  ALLEY 

BUBBLES 

To  a  new  tune  called  1  The  Grand  Elixir ,  or,  The  Philosopher ’ 

Stone' 


i. 

In  London  stands  a  famous  pile, 

And  near  that  pile  an  alley, 

Where  merry  crowds  for  riches  toil, 

And  Wisdom  stoops  to  Folly. 

Here  sad  and  joyful,  high  and  low, 
Court  Fortune  for  her  graces  ; 

And  as  she  smiles  or  frowns,  they  show 
Their  gestures  and  grimaces. 


ii. 

Here  stars  and  garters  do  appear, 
Among  our  lords  the  rabble  ; 

To  buy  and  sell,  to  see  and  hear, 

The  Jews  and  Gentiles  squabble. 

Here  crafty  courtiers  are  too  wise 
For  those  who  trust  to  Fortune  ; 

They  see  the  cheat  with  clearer  eyes, 
Who  peep  behind  the  curtain. 

hi. 

Our  greatest  ladies  hither  come, 

And  ply  in  chariots  daily  ; 

Oft  pawn  their  jewels  for  a  sum 
To  venture  in  the  alley. 

Young  harlots,  too,  from  Drury  Lane, 
Approach  the  ’Change  in  coaches, 

To  fool  away  the  gold  they  gain 
By  their  impure  debauches. 


IV. 

Long  heads  may  thrive  by  sober  rules, 
Because  they  think,  and  drink  not ; 
But  headlongs  are  our  thriving  fools, 
Who  only  drink,  and  think  not. 


THE  NATION  IN  DISTRESS 


147 


The  lucky  dogs,  like  spaniel  dogs, 
Leap  into  South-sea  water, 

And  there  they  fish  for  golden  frogs, 
Not  caring  what  conies  a’ter. 


v. 

’Tis  said  that  alchemists  of  old 
Could  turn. a  brazen  kettle 
Or  leaden  cistern  into  gold, — 

That  noble,  tempting  metal ; 

But  if  it  here  may  be  allow’d 

To  bring  in  great  and  small  things, 
Our  cunning  South  Sea,  like  a  god, 
Turns  nothing  into  all  things. 


VI. 

What  need  have  we  of  Indian  wealth, 

Or  commerce  with  our  neighbours  ? 

Our  constitution  is  in  health, 

And  riches  crown  our  labours. 

Our  South- sea  ships  have  golden  shrouds, 
They  bring  us  wealth,  ’tis  granted, 

But  lodge  their  treasure  in  the  clouds, 

To  hide  it  till  it’s  wanted. 

VII. 

Oh  !  Britain,  bless  thy  present  state, 
Thou  only  happy  nation  ; 

So  oddly  rich,  so  madly  great, 

Since  bubbles  came  in  fashion  ! 

Successful  rakes  exert  their  pride, 

And  count  their  airy  millions  ; 

While  homely  drabs  in  coaches  ride, 
Brought  up  to  Town  on  pillions. 

VIII. 

Few  men,  who  follow  reason’s  rules, 

Grow  fat  with  South- sea  diet ; 

Young  rattles  and  unthinking  fools 
Are  those  that  flourish  by  it. 

Old  musty  jades,  and  pushing  blades, 
Who’ve  least  consideration, 

Grow  rich  apace  ;  while  wiser  heads 
Are  struck  with  admiration. 


148 


THE  SOUTH  SEA  BUBBLE 


IX. 

A  race  of  men,  who  t’other  day 
Lay  crush’d  beneath  disasters, 

Are  now  by  stock  brought  into  play, 
And  made  our  lords  and  masters. 
But  should  the  South-sea  Babel  fall, 
What  numbers  would  be  frowning  ! 
The  losers  then  must  ease  their  gall 
By  hanging  or  by  drowning. 


x. 

Five  hundred  millions,  notes  and  bonds, 
Our  stocks  are  worth  in  value  ; 

But  neither  lie  in  goods  nor  lands, 

Or  money,  let  me  tell  you. 

Yet  though  our  foreign  trade  is  lost, 

Of  mighty  wealth  we  vapour  ; 

When  all  the  riches  that  we  boast 
Consists  in  scraps  of  paper  ! 


THE  SOUTH-SEA  BALLAD 

’Change  Alley’s  so  thin  that  a  man  may  now  walk, 
And  if  he’ll  but  listen  may  hear  himself  talk, 

For  since  the  suppression  of  Bubbles  in  June 
Those  clamorous  catches  are  quite  out  of  tune. 

No  more  of  the  Hubbles  and  Bubbles  we  see, 

But  all  the  whole  nation  attends  the  South-Sea. 

The  Salts  and  the  Fisheries  likewise  are  gone, 

All  the  Stock  of  the  Bubbles  is  swallow’d  in  one, 
Which  (barring  the  ruin  of  all  other  trade) 

Is  the  cleverest  project  that  ever  was  made  : 

For  now  the  contrivers  are  tipt  with  a  fee, 

If  they  souse  the  subscribers  into  the  South- Sea. 

What  numbers  have  got  that  insatiable  itch 
And  endless  ambition  of  still  growing  rich  : 

The  man  that  was  formerly  not  worth  a  plumb, 

Till  he  makes  it  a  million  keeps  gnawing  his  thumb 
For  that  is  the  least,  as  the  wise  men  agree, 

Can  content  an  adventurer  in  the  South-Sea. 


THE  NATION  IN  DISTRESS 


149 


All  the  Town  is  so  eager  their  fortune  to  try, 

That  nobody  can  the  temptation  deny  ; 

So  craftily  laid  is  the  scheme  of  the  gin 

That  some  of  the  parsons  themselves  are  drawn  in  : 

Which  of  these  would  accept  an  Archbishop  to  be, 

To  refuse  a  Directorship  in  the  South-Sea. 

What  number  of  upstarted  figures  we  meet 
Set  up  by  stock- jobbing  in  every  street ; 

They’re  so  fond  of  their  arms,  when  they  come  t’approach, 
They  can  hardly  for  staring  get  into  their  coach  ; 

But  when  we  examine  their  true  pedigree, 

We  trace  their  original  from  the  South-Sea. 

Their  gold-sanded  ocean  is  not  like  the  rest, 

But  is  quite  of  a  different  nature  possest ; 

It  has  such  as  no  other  sea  yet  ever  had, 

Instead  of  preventing,  ’twill  make  people  mad  : 

Distracting  their  reason  to  such  a  degree 

That  headlong  they  throw  themselves  in  the  South-Sea. 

’Tis  a  comical  sight  to  behold  the  deceit 
Of  all  ranks  of  men  met  each  other  to  cheat, 

To  see  my  Lord  Duke  make  a  rout  and  ado 
In  a  coffee-house  crowd  with  a  politic  Jew, 

The  most  orthodox  nowadays  reckon’d  is  he 
Whose  stock  is  all  capital  in  the  South-Sea. 

This  mystery  some  would  pretend  to  explain, 

While  those  that  get  money  but  laugh  at  their  pain  ; 

The  wisest  of  all,  with  their  racket  and  rout, 

Find  it  just  like  a  tub  with  the  bottom  knock’d  out  ; 

The  cream  of  the  jest  is  with  those  that  make  free, 

With  the  general  scramble  amidst  the  South- Sea. 

Like  Pharaoh’s  lean  kine  that  devour’d  the  fat, 

It  has  knock’d  down  the  puny  contrivances  flat ; 

But  if  I  mistake  not  I’ve  read  that  his  host 
And  himself  in  the  Red  Sea  were  utterly  lost  : 

He  thought  to  get  riches,  and  why  should  not  we 
Remember  the  Red,  when  we  cross  the  South,  Sea  ? 

The  writers  of  the  ballads  certainly  did  not  evince  any 
sympathy  for  the  sufferers,  and,  indeed,  they  were  not 
alone  in  their  attitude,  for  even  at  the  time  there  were 


150 


THE  SOUTH  SEA  BUBBLE 


many  who  asked,  Why,  if  the  Directors  were  to  be 
punished  for  their  lust  of  gain,  should  the  speculators, 
who  had  been  moved  by  the  same  spirit,  go  free  ?  There 
were  others,  too,  who,  not  suffering  fools  gladly,  had 
little  patience  with  those  who  had  been  deceived  :  the 
fraud  was  so  glaringly  obvious. 

‘  Ye  wise  philosophers,  explain 

What  magic  makes  our  money  rise, 

When  dropt  into  the  Southern  main  ; 

Or  do  these  jugglers  cheat  our  eyes  ? 

‘Put  in  your  money  fairly  told  ; 

Presto  !  be  gone — ’Tis  here  again  : 

Ladies  and  gentlemen,  behold, 

Here’s  every  piece  as  big  as  ten. 

4  Thus  in  a  basin  drop  a  shilling, 

Then  fill  the  vessel  to  the  brim, 

You  shall  observe,  as  you  are  filling, 

The  pond’rous  metal  seems  to  swim  : 

4  It  rises  both  in  bulk  and  height, 

Behold  it  swelling  like  a  sop  ; 

The  liquid  medium  cheats  your  sight  : 

Behold  it  mounted  to  the  top  !  ’ 

Thus  Swift  in  his  4  South  Sea  Project,’  in  which 
further  he  pours  scorn  on  those  who  plunge  into  the 
unfamiliar  waters  of  finance,  and  compete  for  prizes 
against  experts. 

4  One  fool  may  from  another  win, 

And  then  get  off  with  money  stored  ; 

But,  if  a  sharper  once  comes  in, 

He  throws  it  all,  and  sweeps  the  board. 

4  As  fishes  on  each  other  prey, 

The  great  ones  swallowing  up  the  small, 

So  fares  it  in  the  Southern  Sea  ; 

The  whale  directors  eat  up  all, 


THE  NATION  IN  DISTRESS 


151 


‘  When  stock  is  high,  they  come  between. 
Making  by  second-hand  their  offers  ; 
Then  cunningly  retire  unseen, 

With  each  a  million  in  his  coffers. 

*  Each  poor  subscriber  to  the  sea 

Sinks  down  at  once,  and  there  he  lies  ; 
Directors  fall  as  well  as  they, 

Their  fall  is  but  a  trick  to  rise.’ 


A  certain  number  of  simple,  innocent  folk  there  were 
no  doubt  who  had  been  lured  into  the  spiders’  den  ;  and 
these  were  sincerely  and  heartily  to  be  pitied ;  but  it 
was  just  these  folk  whose  voices  only  in  rare  cases  pene¬ 
trated  beyond  the  family  circle.  It  was  the  ruined 
gamblers  who  rent  the  air  with  their  cries,  the  men  who 
had  bought  as  cheaply  as  they  could  with  every  intention 
of  selling  so  soon  as  the  stock  had  risen  sufficiently  to 
give  them  a  profit  that  would  satisfy  their  greed  ;  the 
men  who  plunged  beyond  their  means,  and,  standing 
to  win,  could  not  pay  if  they  lost.  The  only  mistake 
these  folk  had  made  was  that  they  had  allowed  their 
craving  to  get  rich  quickly  to  overcome  their  prudence. 
Walpole  speculated  on  a  vast  scale,  and,  selling  out  at 
the  top  of  the  boom,  made  a  great  fortune  with  which  he 
rebuilt  Houghton  and  laid  the  foundation  of  his  famous 
collection  of  pictures.  Acting  under  his  guidance,  the 
Prince  of  Wales  bought  £20,000  stock  and  his  consort 
half  the  amount,  at  £150  per  cent.,  and  realised  their 
holdings  at  a  high  price  ;  and  many  persons  about  the 
Court  followed  their  lead.  Mrs.  Howard1  bought ;  and 

1  Henrietta  Howard  (1688-1767),  the  wife  of  the  Hon. 
Charles  Howard,  afterwards  ninth  Earl  of  Suffolk  ;  a  Woman 
of  the  Bedchamber  to  Caroline  both  when  Princess  of  Wales 
and  Queen. 


152 


THE  SOUTH  SEA  BUBBLE 


so  did  Colonel  Campbell,1  the  husband  of  the  beautiful 
Mary  Bellenden  ;  and  Sir  David  Hamilton,2  the  royal 
physician,  who  held  his  stock  too  long,  and  lost  £80,000. 
Lechmere,  as  has  been  said,  made  much  money ;  Sir 
Robert  Sutton  £100,000  ;  and  Sir  Matthew  Decker,  a 
Director  of  the  Company  in  its  early  days,  several  times 
that  amount.  4  Decker  has  not  for  four  months  past 
had  anything  to  do  in  Exchange  Alley  upon  his  own 
account,’  Dr.  William  Stratford  wrote  on  November  9 
to  Edward  Harley,  junior.  4  He  had  sold  out  betimes, 
and  had  nothing  left  in  any  of  the  stocks  but  what  was 
pure  gains.  At  the  time  the  report  went  of  him  [that 
he  was  ruined]  he  had  written  to  the  great  banker  in 
Amsterdam,  Pels,  who,  as  Decker  thought  might  be 
pressed,  to  give  him  leave,  if  he  had  occasion  to  draw  at 
sight  £100,000  on  him.’  3 

Humble  folk,  too,  had  made  fortunes.  Indeed,  a  new 
aristocracy  had  arisen — an  aristocracy  of  humble  origin, 
but  possessed  of  vast  wealth  ;  and  the  nouveaux  riches 
began  to  jostle  the  aristocracy  of  birth,  whose  supremacy 
had  hitherto  been  unchallenged.  4  We  are  informed,’ 
one  newspaper  stated  on  July  9,  4  that  since  the  late 
hurly-burly  of  stock- jobbing,  there  has  appeared  in 
London  two  hundred  new  coaches  and  chariots,  besides 
as  many  more  now  on  the  stocks  in  the  coaehmakers’ 
yards  ;  above  four  thousand  embroidered  coats  ;  about 
three  thousand  gold  watches  at  the  sides  of  their - 

1  Colonel  John  Campbell  (d.  1770),  succeeded  as  (fourth) 
Duke  of  Argyle  in  1761.  He  married  Mary  Bellenden  (d.  1736), 
youngest  daughter  of  John,  second  Lord  Bellenden,  who  until 
her  marriage  was  a  Maid  of  Honour  to  the  Princess  of  Wales. 

2  Sir  David  Hamilton  (1663-1721),  a  leading  practitioner 
in  midwifery,  and  successively  physician  to  Queen  Anne,  who 
knighted  him,  and  to  the  Princess  of  Wales. 

3  Portland  MSS.,  VII.,  282. 


THE  NATION  IN  DISTRESS 


153 


and  their  wives  :  some  few  private  acts  of  charity  ;  and 
about  two  thousand  broken  tradesmen.’ 1  4  Our  South 

Sea  equipages  increase  every  day,’  so  runs  a  paragraph 
in  Applebee’s  Journal  on  August  5,  4  the  City  ladies  buy 
South  Sea  jewels,  hire  South  Sea  maids,  take  new 
country  South  Sea  houses  ;  the  gentlemen  set  up  South 
Sea  coaches,  and  buy  South  Sea  estates,  that  they 
neither  examine  the  situation,  the  nature  or  quality  of 
the  soil,  or  price  of  the  purchase,  only  the  annual  rent 
and  the  title  :  for  the  rest  they  talk  all  by  the  lump,  and 
give  forty  to  fifty  years’  purchase.  This  has  brought 
so  many  estates  to  market,  that  the  number  of  land- 
jobbers  begin  to  increase  to  a  great  degree  almost  equal 
to  the  stock-jobbers  we  had  before.’ 

These  new  men  purchased  the  estates  of  the  ruined 
gamblers,  and  presently  began  to  exercise  power  as  local 
magnates,  and  presently  enlarged  their  sway  in  a  manner 
that  had  far-reaching  effects.  4  They  say  there  is  a  great 
deal  of  money  spent  in  the  elections  by  a  new  sort  of 
people  that  never  appeared  before,’  Dr.  William  Strat¬ 
ford  wrote  to  Edward  Harley,  junior,  March  22,  1722. 
4  They  spend  out  of  their  own  pockets,  and  not  upon  the 
Court  expenses.  They  are  generally,  it  is  said,  the  new 
gentry,  that  have  been  raised  by  the  late  4<  bubbles.”  No 
doubt  such  a  set  of  men  will  be  as  mercenary  as  any 
other,  but  they  will  not  serve  without  pay,  and  the 
ministers  may  be  obliged  to  discard  some  of  their  old 
dependents,  to  make  way  for  these  new-comers.’ a 
Others,  though  not  so  fortunate,  at  least  had  not 
suffered  heavy  losses.  4 1  assure  you  that  I  have  done 
nothing  for  these  last  two  months  but  South  Sea  stock, 
and  yet  I  am  not  myself  any  great  sufferer  by  it ;  but 

1  Quoted  in  Wright’s  Caricature  History  of  the  Georges,  46. 

a  Portland  MSS.,  VII.,  314, 


154 


THE  SOUTH  SEA  BUBBLE 


so  many  of  my  acquaintances  are  ruined  and  undone,  that 
I  am  under  as  much  anxiety  and  uneasiness  of  mind 
as  if  I  was  so  myself,’  William  Pulteney  1  wrote  to  his 
cousin  Daniel  Pulteney,2  November  20,  1720.  4 *  It  is 

ridiculous  to  tell  you  what  a  sum  I  might  once  have 
been  master  of ;  but  since  I  have  not  had  discretion 
enough  to  secure  that,  it  is  still  some  comfort  to  have 
put  my  affairs  into  such  a  way,  that  let  what  will 
happen,  I  can  be  no  loser  by  it.’3  Like  William  Pul¬ 
teney,  James  Windham  might  have  had  a  fortune. 
4 1  grow  rich  so  fast  that  I  like  stock- jobbing  above  all 
things,’  he  wrote  to  his  brother  Ashe,  in  May,  1720. 
4  Since  the  South  Sea  have  declared  what  they  give  to 
the  annuitants,  stock  has  risen  vastly.  South  Sea  has 
this  day  been  £460  ;  they  offer  £50  per  cent,  for  the 
refusal  at  £450  for  the  opening.  I  think  it  will  be  £500 
before  the  shutting,  I  mean  the  stock.’ 4  He  talked 
of  buying  an  estate  for  £20,000,  and  might  well  have  done 
this,  and  had  an  ample  income  with  which  to  keep  it  up, 
but  for  the  fact  that  instead  of  realising  he,  flushed 
with  success,  extended  his  operations,  and  was  brought 
down  in  the  4  slump.’  4  Poor  Jimmy’s  affairs  are  most 
irretrievable,’ 6  William  Windham,  another  brother, 
wrote  presently  to  Ashe  Windham.  Applicable  to  those 
in  the  same  plight  as  James  Windham  are  some  verses 
written  by  Swift : — 

1  William  Pulteney  (1684-1764),  M.P.  for  Heydon  ;  Secre- 
tary-at-War,  1714  ;  created  Earl  of  Bath,  1742. 

2  Daniel  Pulteney  (d.  1731),  entered  Parliament  1721,  in 
which  year  he  became  a  Lord  of  the  Admiralty  under  Walpole. 

3  Pulteney  Papers,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II.,  194. 

4  Ketton  MSS.,  200. 

6  November  26,  1720  ;  Ibid.,  201. 


THE  NATION  IN  DISTRESS 


155 


4  In  stock  three  hundred  thousand  pounds, 

I  have  in  view  a  lord’s  estate  ; 

My  manors  all  contiguous  round  ! 

A  coach-and-six,  and  serv’d  in  plate  ! 

4  Thus  the  deluded  bankrupt  raves, 

Puts  all  upon  a  desperate  bet ; 

Then  plunges  in  the  Southern  waves, 

Dipt  over  head  and  ears — in  debt. 

*  So,  by  a  calendure  misled, 

The  mariner  with  rapture  sees, 

On  the  smooth  ocean’s  azure  bed, 
Enamell’d  fields  and  verdant  trees  : 

4  With  eager  haste  he  longs  to  rove 
In  that  fantastic  scene,  and  thinks 
It  must  be  some  enchanted  grove  ; 

And  in  he  leaps,  and  down  he  sinks. 

*  Five  hundred  chariots  just  bespoke, 

Are  sunk  in  these  devouring  waves, 

The  horses  drown’d,  the  harness  broke, 
And  here  the  owners  find  their  graves. 

*  Like  Pharaoh,  by  directors  led, 

They  with  their  spoils  went  safe  before  ; 
His  chariots,  tumbling  out  the  dead, 

Lay  shatter’d  on  the  Red  Sea  shore. 

4  Raised  up  on  Hope’s  aspiring  plumes, 

The  young  adventurer  o’er  the  deep 
An  eagle’s  flight  and  state  assumes, 

And  scorns  the  middle  way  to  keep. 

*  On  paper  wings  he  takes  his  flight, 

With  wax  the  father  bound  them  fast ; 
The  wax  is  melted  by  the  height, 

And  down  the  towering  boy  is  cast. 

4  A  moralist  might  here  explain 

The  rashness  of  the  Cretan  youth  ; 
Describe  his  fall  into  the  main, 

And  from  a  fable  form  a  truth. 


156 


THE  SOUTH  SEA  BUBBLE 


*  His  wings  are  his  paternal  rent, 

He  melts  the  wax  at  every  flame  ; 

His  credit  sunk,  his  money  spent, 

In  Southern  Seas  he  leaves  his  name.’  1 

Most  of  those  who  had  not  sold  out  when  the  4  slump  ’ 
came  were  indeed  undone.  Retrenchment  was  the  order 
of  the  day  in  innumerable  households.  4  Day  and  night, 
summer  and  winter,  are  not  more  different  than  the 
state  of  affairs  here  from  the  time  of  my  leaving  town 
to  this,’  Edward  Harley  wrote  to  Lord  Oxford.  4  Then 
nothing  but  a  boundless  insolence  in  their  supposed 
wealth ;  now  nothing  appears  but  dejection.’ 2  The 
fashionable  resorts  were  deserted.  4  We  hope  that  you 
will  come  to  Bath  this  season  very  soon,’  Jane  Pitt  3 
wrote  to  the  Hon.  Mrs.  Pitt,4  October  2,  1720,  4  for  upon 
the  fall  of  the  South  Sea  the  place  empties  so  fast  that 
you  may  have  your  choice  of  lodgings  at  the  winter 
price.’  5 6  The  effect  on  the  metropolis  was,  of  course, 
much  greater.  4  So  many  undone  people,’  Lord  Berkeley 
of  Stratton  wrote  on  November  12  to  Lord  Strafford, 
who  had  suffered  severely,  4  will  make  London  a  very 
melancholy  place  this  winter.’ 6  4  Many  of  the  first 
rank  are  wounded  in  their  estates  beyond  retrieve,’ 
Edward  Harley  wrote  to  Lord  Oxford.  4  Lord  Har- 

1  The  South  Sea  Project . 

2  Portland  MSS.,  V.,  65. 

3  Jane  (d.  1727),  daughter  of  James  Innes,  of  Reid  Hall, 
Moray,  married  circa  1678  Thomas  (‘  Diamond  ’)  Pitt,  Governor 
of  Madras. 

4  Harriet  Villiers,  younger  daughter  of  the  Hon.  Edward 
Villiers  of  Dromana,  co.  Waterford,  a  sister  of  John,  fourth 
Viscount  and  first  Earl  of  Grandison,  married  Robert  Pitt, 
eldest  son  of  ‘  Diamond  ’  Pitt.  Their  second  child,  William, 

was  the  first  Lord  Chatham. 

6  Fortescue  MSS.,  I.,  65. 

6  Wentworth  Papers,  450. 


THE  NATION  IN  DISTRESS 


157 


court  1  has  sold  out  none.  This  is  the  condition  of  very 
many  in  both  Houses,  where  every  one  is  grasping  at 
anything  that  is  thought  a  salve  for  his  own  sore.’ 2 
Of  this  there  is  an  abundance  of  evidence.  4  There  are 
very  many  and  considerable  families  reduced  by  extrava¬ 
gant  bargains,5  Drummond  wrote  to  Daniel  Pulteney. 
4  Indeed,  even  the  South  Sea  Directors  included,  hardly 
one  in  twenty  are  gainers.  Sir  Justus  Beck’s 3  debt 
is  £340,000,  and  he  cannot  pay  half- a- crown  in  the 
pound  ;  most  of  those  who  are  undone  are  in  like  state.’ 4 
William  Windham  had  the  same  tale  to  tell  his 
brother  Ashe  :  4  There  never  was  such  distraction  and 
undoing  in  any  country.  You  can’t  suppose  the  number 
of  families  undone.  One  may  almost  say  everybody  is 
ruined  who  had  traded  beyond  their  stock.  Many  a 
£100,000  man  not  worth  a  groat.5  5  So  general,  indeed, 
had  been  the  indulgence  in  speculation,  that  Drummond 
mentions,  as  an  interesting  fact,  4  neither  Lord  Stanhope, 
Argyle,  or  Roxburgh  6  had  been  in  the  stocks.5  The 
Duke  of  Wharton  had  speculated  largely,  and  lost,  it  is 
said,  £120,000 — a  fact  which  may  well  have  spurred 
him  to  the  eloquence  he  presently  displayed  in  debates  in 
the  House  of  Lords  on  the  South  Sea  Company  ;  and  the 
Duke  of  Bolton7  was  a  heavy  sufferer.  Another  Duke, 

1  Simon  Harcourt,  first  Baron  Harcourt  (1661  ?-1727), 
Lord  Chancellor,  1713-1714  ;  created  Viscount,  1721. 

2  January  11,  1721  ;  Portland  MSS .,  V.,  612. 

3  Sir  Justus  Beck,  bart.  (d.  1722),  a  London  merchant  of 
foreign  extraction.  He  was  created  baronet,  November  1 , 
1714,  and  was  the  first  person  so  honoured  by  George  I. 

4  November  24,  1720  ;  Pulteney  Papers ,  quoted  in  Coxe’s 
Memoirs  of  Sir  Robert  Walpole,  II.,  196. 

6  ICetton  MSS.,  201. 

6  John  Ker,  fifth  Earl,  and  first  Duke  of  Roxburgh  (d.  1741). 

7  Charles  Paulet,  second  Duke  of  Bolton  (1661-1722),  Lord- 
Lieutenant  of  Ireland,  1717-1722. 


158 


THE  SOUTH  SEA  BUBBLE 


his  Grace  of  Portland,  who  had  thought  to  relieve  his 
embarrassed  condition  by  successful  speculation,  nearly 
completed  his  ruin.  He  was,  indeed,  so  hard  hit  that 
he  was  reduced  to  soliciting  the  post  of  Captain- General 
of  Jamaica.  The  idea  of  a  Duke  being  in  such  straits 
was  so  repellent  to  some  in  high  places,  that  the  idea  was 
mooted  of  a  pension  which  would  enable  him  to  remain 
in  England  and  nurse  his  estates  :  the  Duke,  to  his 
credit,  would  have  none  of  it  and  went  in  1721  to 
Jamaica,  where  he  died  five  years  later.  Lord  London¬ 
derry  1  was  a  very  heavy  loser ;  and  so  was  Lord 
Chetwynd ;  as  well  as  Lord  Lonsdale,2  who  applied 
for  the  government  of  the  Leeward  Islands,  and  Lord 
Irvine,  who  asked  to  be  sent  to  Barbados.  4 1  believed 
it  was  rightly  judged  in  my  Lord,’  Lady  Irvine  wrote 
to  Lord  Carlisle,  4  to  put  in  as  soon  as  he  has  done  for 
this  government,  since  I  believe  there  will  be  every  day 
more  and  more  people  of  quality  reduced  to  the  necessity 
of  leaving  England.’ 3 

Of  the  effects  of  the  disaster  on  persons  in  high  places 

1  Thomas  Pitt  (1688g?-1729),  the  son  of  ‘Diamond’  Pitt. 
He  married  in  1719  Lady  Frances  Ridgway,  the  younger 
daughter  of  Robert,  fourth  and  last  Earl  of  Londonderry,  and 
in  that  year  was  created  Baron  Londonderry.  In  1726  he  was 
created  Earl  of  Londonderry.  He  sat  in  the  English  House  of 
Commons,  1713-1727,  when  he  vacated  his  seat  on  being 
appointed  Governor  of  the  Leeward  Islands.  He  died  two 
years  later  at  St.  Kitts. 

2  Henry  Lowther,  third  Viscount  Lonsdale  (d.  1751),  was 
appointed  Governor  of  the  Leeward  Islands  in  March,  1721. 
He  was  Lord  Privy  Seal,  1733-1735. 

3  November  17,  1720  ;  Carlisle  MSS.,  25.  Irvine  was  given 
the  post,  but  he  died  in  the  next  year  before  going  to  Barbados. 
The  appointment  seems  at  this  time  to  have  brought  misfortune 

in  its  train,  for  Lord  Belhaven  was  given  the  succession  in 
April,  1721,  and  he  perished  by  shipwreck  off  the  Lizard  on 
his  outward  passage. 


THE  NATION  IN  DISTRESS 


159 


particulars  were  sometimes  forthcoming,  but  of  the 
troubles  that  fell  upon  the  heads  of  lesser  folk  little  was 
heard.  4  As  to  the  misery  which  I  think  will  attend 
this  affair  we  do  not  see  the  hundredth  part,’  William 
Windham  wrote  to  his  brother  Ashe.  4  Almost  all  one 
knows  or  sees  are  upon  the  very  brink  of  destruction,  and 
those  who  were  reckoned  to  have  done  well  yesterday 
are  found  stark  nought  to-day.  These  devils  of  Direc¬ 
tors  have  ruined  more  men’s  fortunes  in  this  world,  than 
I  hope  old  Beelzebub  will  do  souls  for  in  the  next.’ 1 
When  an  eminent  physician  2  learnt  that  he  had  lost 
five  thousand  guineas,  he  said  airily, 4  Why,  ’tis  but  going 
up  five  thousand  flights  of  stairs  more  ’ ;  but  few  could 
afford  to  be  so  philosophical.  Many  tragedies  were 
caused,  and  some  sad  stories  have  here  and  there  come 
to  light.  4  One  Franks  of  Merton,  a  clergyman  whom 
possibly  you  may  remember  who  had  Wood  Eaton  and 
the  fine  cure  of  Gamblingay  near  you  from  that  College, 
is  thrown  into  the  Castle  here  for  debts  by  his  adventures 
in  the  South  Sea,’  Dr.  Stratford  informed  Edward 
Harley,  junior,  June  29,  1721  ;  4  and  Painter,  the  late 
Rector  of  Exeter’s  daughter,  has  lost  £1,200  which  her 
father  left  her,  and  is  gone  to  service  into  Duke  of 
Chandos’  family.  I  am  afraid  we  shall  every  day  hear 
more  of  these  instances.’ 3  The  sufferings  of  thousands 
of  poor  homes  are  buried  in  oblivion. 

The  nation  was  in  a  state  so  unsettled  and  ill-satis¬ 
fied  that  Atterbury  was  perhaps  not  unjustified  in 
thinking  that  the  moment  had  come  when  the  restora- 

1  Ketton  MSS.,  207. 

2  This  story  is  told  of  Dr.  John  Radcliffe  (Tom  Brown  : 
Works,  ed.  1709,  IV.,  7),  but  the  better  known  physician  of 
that  name  died  in  1714,  and  the  other  only  took  his  degree  of 
M.D.  in  1721,  so  it  is  unlikely  that  it  was  either. 

3  Portland  MSS.,  VII.,  300. 


160 


THE  SOUTH  SEA  BUBBLE 


tion  of  the  Stuart  dynasty  would  not  be  vigorously 
opposed.  Earlier  in  the  year,  when  the  boom  was  at 
its  height,  he  had  been  despondent,  and  writing  on 
May  6,  1720,  to  General  Dillon,1  he  had  thought  that 
then  or  never  should  the  attempt  be  made.  4  The  sum 
of  my  letter  to  the  King,’  he  said,  4  is  to  assure  our 
friends  abroad  that  the  reconciliation 2  which  makes  so 
great  a  noise,  is,  whatever  may  be  apprehended  of  it, 
imperfect  and  insincere  at  the  bottom,  and  calculated 
only  to  serve  views  at  the  present  juncture  which  could 
not  have  been  so  well  attained  without  it.  But  in 
truth  and  at  the  bottom,  the  parties,  as  well  the  principal 
as  those  who  serve  under  them,  are  still  as  much  separ¬ 
ated  in  interest  and  inclination  as  ever.  This  is  the 
certain  state  of  the  case  at  present,  and  such  as  it  will 
continue  for  some  time,  notwithstanding  whatever  ap¬ 
pearances  there  may  be  to  the  contrary ;  and  could 
the  opportunity  be  made  use  of  from  abroad,  this  is  the 
moment  when  an  attempt  to  disturb  us  would  be  most 
likely  to  succeed  and  throw  us  into  the  utmost  confusion. 
But  on  the  other  side,  if  this  opportunity  be  not  laid 
hold  of  by  France  and  Spain,  matters  will  alter  here  in 
some  time  for  the  worse.  The  seeming  reconciliation 
will  by  next  winter  grow  real,  and  the  common  necessity 
of  affairs  will  drive  the  new  allies  here  into  measures 
that  may  be  for  their  mutual  interest,  and  into  a  closer 
and  sincerer  conjunction,  and  the  grand  money  schemes 
here  projected  of  late  will  settle  and  fix  themselves  in 
such  a  manner  that  it  will  not  be  easy  to  shake  them. 

1  Arthur  Dillon  (1070-1733),  general  in  the  French  service  > 
the  Pretender’s  agent  at  Paris. 

2  In  April  Walpole  had  accepted  the  olfice  of  Paymaster  of 
the  Forces,  and  Paul  Methuen  that  of  Comptroller  of  the 
Household,  while  Lord  Townshend  became  President  of  the 
Council  in  Lord  Sunderland’s  Administration. 


THE  NATION  IN  DISTRESS 


161 


It  so  happens  at  this  particular  point  of  time  that  there 
is  no  bank  or  set  of  men  in  the  whole  kingdom  (those 
only  excepted  that  engross  the  power  and  taste  the 
vast  profits  lately  made)  who  are  not  to  the  highest 
degree  uneasy,  and  would  be  found  to  be  so  in  a  very 
remarkable  manner  should  anything  happen  from 
abroad  that  might  make  it  advisable  to  exert  their 
resentments.  This  is  the  very  truth  of  the  matter,  and 
methinks  if  it  were  well  understood  might  induce  those 
who  only  can  make  effectual  advantage  of  the  juncture, 
and  whose  interest  it  is  to  do,  not  to  neglect  it.’  1 
Atterbury’s  advice  was  ignored,  wisely,  in  all  proba¬ 
bility,  for  though  many  might  be  4  uneasy,’  this  could 
not  legitimately  be  interpreted  into  a  desire  to  send 
King  George  back  to  Hanover  in  order  to  instal  King 
James  on  the  throne  of  England.  People  here  had 
given  proof  in  ’15  that  however  much  they  might  dis¬ 
like  the  Guelph,  they  would  not  have  the  Stuart.  When, 
however,  the  4  grand  money  schemes  ’  did  not  4  settle 
and  fix  ’  themselves,  but  brought  the  nation  to  disaster, 
the  intriguing  Bishop  thought  that  again  a  favourable 
opportunity  had  arisen.  4  Atterbury,’  wrote  Arthur 
Onslow  in  his  4  Anecdotes,’  4  had  been  long  projecting 
this  revolution  ;  but  went  now  upon  the  foundation 
of  the  discontents  in  this  country  arising  from  the  South 
Sea  transactions,  which  were  still  fresh  in  the  minds  and 
hearts  of  the  people,  especially  the  sufferers,  many  of 
whom  imputed  their  losses  to  the  Government,  as  design¬ 
ing  by  a  fraud  to  deprive  them  of  their  property,  and 
propagated  this  notion  with  too  much  success  among 
the  people  in  general.’ 2  It  is  a  matter  of  common 
knowledge  that  the  Jacobites,  still  depressed  by  the 

1  Stanhope  :  History  of  England ,  II.,  appendix  p.  xiv. 

2  l list.  MSS.  Com.  Report  XVI.,  App.  Pt.  IX.,  402. 

M 


162 


THE  SOUTH  SEA  BUBBLE 


ill- success  of  their  attempt  seven  years  earlier,  did  not 
take  advantage  of  the  dissatisfaction  that  was  wide¬ 
spread  throughout  the  land.  The  feeling  of  the  Pre¬ 
tender  about  this  time  is  made  known  in  an  interesting 
letter,  written  to  his  father,  on  May  6,  1721,  by  an 
anonymous  English  traveller  at  Rome.  4  The  Pretender,’ 
he  said,  4  bemoaned  the  misfortune  of  England  groaning 
under  a  load  of  trouble  and  the  severest  hardships, 
contracts  and  imposts  to  support  foreign  interests. 
He  lamented  the  ill-treatment  and  disregard  of  the 
ancient  nobility,  and  said  it  gave  him  great  trouble 
to  see  the  interest  of  the  nation  abandoned  to  the  direc¬ 
tion  of  a  new  set  of  people  who  must  at  any  rate  enrich 
themselves  byt  he  spoil  of  their  country.  44  Some  may 
imagine,”  he  continued,  “that  these  calamities  are  not 
displeasing  to  me  because  they  may  in  some  measure 
turn  to  my  advantage.  I  renounce  all  such  unworthy 
thoughts.  The  love  of  my  country  is  the  first  principle 
of  my  worldly  wishes,  and  my  heart  bleeds  to  see  so 
brave  and  honest  a  people  distressed  and  misled  by  a 
few  wicked  men  and  plunged  into  miseries  almost  irre¬ 
trievable.”  Thereupon  he  rose  briskly  from  his  chair 
and  expressed  his  concern  with  fire  in  his  eyes.’  1 

Whether  the  danger  of  rebellion  was  real  or  imaginary, 
there  is  no  doubt  that  the  Government  deemed  it  expe¬ 
dient  in  the  highest  degree  that  the  King  should  be  on 
the  spot,  and  messengers  wrere  sent  with  dispatches  beg¬ 
ging  him  and  Lord  Sunderland,  who  had  accompanied 
him  abroad,  to  return  with  all  speed.  So  alarming  was 
the  news  that  reached  the  Court  that  the  Hanoverian 
minister,  Bernstorff,  thought  it  unwise  for  George  to 
go  to  England,  and  actually  suggested  that  he  should 
resign  the  British  crown.  Whatever  the  faults  of 
1  Clarendon  Historical  Society's  Publications ,  No.  12. 


THE  NATION  IN  DISTRESS 


168 


George,  cowardice  was  not  among  them,  and  he  at  once 
began  his  preparations  for  the  journey.  1 1  had  yes¬ 
terday  the  honour  of  your  Lordship’s  letter,  for  which 
I  return  you  my  very  sincere  thanks,  being  truly  sen¬ 
sible  of  your  goodness  and  friendship  to  me,  of  which  I 
take  this  to  be  a  very  particular  mark,’  Lord  Sunderland 
wrote  to  Lord  Carlisle  from  The  Gohr,  October  19. 
‘  Upon  the  first  news  we  had  of  the  unhappy  turn  the 
stocks  and  public  credit  began  to  take,  we  got  the  King 
to  fix  the  meeting  of  the  Parliament  to  the  25th  of 
November.  Since  that,  within  these  three  or  four 
days,  we  have  had  the  news  of  the  credit’s  being  lower 
and  lower,  and  of  things  being  every  day  in  a  worse 
condition,  the  King  has  taken  the  resolution  of  going 
over,  so  as  to  hold  the  Parliament  on  the  8th  of  Novem¬ 
ber,  which  is  as  soon  as  it  is  possible  for  him  to  be  there, 
and  orders  are  sent  for  the  necessary  notice.  I  myself 
should  have  set  out  as  soon  as  we  had  the  news  of  this 
melancholy  state  of  things,  which  was  but  three  or 
four  days  ago,  but  that  I  thought  the  first  necessary 
step  was  to  fix  the  King’s  going  as  soon  as  possible,  and 
now  that  is  done,  I  shall  set  out  from  this  place  to¬ 
morrow,  so  that  I  hope  in  a  very  few  days  to  have  the 
honour  of  kissing  your  hands  in  England  ;  till  when  I 
will  defer  troubling  your  Lordship  with  a  great  many 
things,  which  I  will  beg  leave  to  talk  out  with  you 
when  I  see  you  there.  All  I  will  say  now  is,  that  I  know 
very  well  that  when  misfortunes  happen  in  most  coun¬ 
tries,  and  particularly  in  England,  it’s  the  way  to  lay 
it  at  the  door  of  those  who  have  a  share  in  the  Admini¬ 
stration  ;  that,  therefore,  ever  since  I  meddled  in  public 
business,  I  never  thought  of  anything  but  of  doing  the 
best  I  could  for  the  public,  with  honest  intentions,  and 
with  as  much  prudence  as  my  poor  understanding  is 


164 


THE  SOUTH  SEA  BUBBLE 


capable  of,  and  for  the  consequences  afterwards,  one 
must  sit  easy  under  them.  That  never  was  more  the 
case  than  in  this  affair  of  the  South  Sea,  which  had 
almost  the  unanimous  approbation  and  applause  of  all 
parties  in  the  nation,  in  Parliament  and  out  of  it,  and 
which  of  a  sudden,  in  the  compass  of  a  very  few,  not 
months,  not  weeks,  but  days,  has  taken  so  strange  and 
so  surprising  a  turn.  As  for  my  having  been  absent,  I 
am  also  very  sensible,  and  hear  it  from  many  quarters, 
that  that  is  complained  of,  but  it  does  not  give  me 
much  uneasiness,  because  I  am  confident  nobody  in 
England  does  imagine  I  ever  came  into  these  parts  of 
the  world  for  my  pleasure,  but  that  all  our  friends 
thought  it  might  be  of  use  to  the  public  services,  and 
particularly  in  contributing  to  the  King’s  early  return 
and  an  early  session,  which  is  brought  about,  and,  I  will 
venture  to  say,  would  not  have  been  so  without  me.’  1 
The  public,  which  was  disgusted  with  the  Ministry, 
looked  to  some  one  to  extricate  it  from  the  trouble  that 
had  fallen  upon  it,  and  their  eyes  turned  to  Robert 
Walpole,  who,  although  a  member  of  the  Government, 
had  taken  no  part  in  the  administration  outside  the 
duties  of  his  office  of  Paymaster  of  the  Forces,  and  had 
consistently  and  resolutely  opposed  the  passage  of  the 
South  Sea  Bill  through  the  House  of  Commons.  ‘  Every¬ 
body  longs  for  you  in  town,  having  no  hopes  from  any 
but  yourself ;  though  I  must  own  I  don’t  see  what 
effectual  help  can  be  given  to  them  till  some  time  has 
worn  off  people’s  fears  and  distrusts  of  one  another,’ 
Robert  Jacombe,  the  Under-Secretary-at-War,  wrote 
to  Walpole  on  October  13.  Walpole,  however,  was  in 
no  hurry  to  leave  his  country  seat,  and  on  November  1 
Jacombe  wrote  to  him  again  :  4  They  all  cry  out  for  you 

1  Carlisle  MSS.,  24. 


THE  NATION  IN  DISTRESS 


165 


to  help  them,  so  that  when  you  come,  you  will  have 
more  difficulties  upon  you  than  ever  you  had.  For 
though  you  are  perfectly  clear  of  this  sad  scheme,  yet 
you  will  be  prodigiously  importuned  by  all  the  sufferers 
to  do  more  than  any  man  can  do  ;  and  more  than  you, 
in  your  judgment,  would  think  ought  to  be  done,  if  it 
could  be  done.’ 1 

All  sorts  of  rumours  were  current  as  to  Walpole’s  inten¬ 
tions,  and  there  was  some  fear  expressed  that  he  would 
seize  the  opportunity  for  his  tit-for-tat  with  Lord 
Sunderland,  who  had  driven  him  from  office  in  1716. 
4  It  has  been  reported  that  Mr.  Walpole,  who  has  the 
greatest  influence  of  any  one  over  the  Directors  of  the 
Bank,  has  all  this  while  prevented  their  complying  with 
the  bargain  they  made  with  the  South  Sea  Company, 
and  that  he  has  it  now  in  his  power  to  ruin  the  South 
Sea  scheme,  and  the  authors  of  it,  at  once  in  revenge  for 
the  trick  they  formerly  served  him,’  William  Pulteney 
wrote  to  Daniel  Pulteney,  November  20.  4  To  tell  the 

truth,  I  do  not  think  there  is  any  very  cordial  affection 
between  the  Ministers  and  him  ;  but  it  is  so  much  the 
interest  of  both  of  them  to  relieve  mankind  from  this 
general  calamity,  that  I  am  persuaded  they  must  co¬ 
operate  in  all  measures  for  doing  of  it,  and  upon  their 
meeting  yesterday,  when  Mr.  Walpole  proposed  some 
things  for  the  South  Sea,  which  was  agreed  to  by  the 
Ministers,  the  stock  got  up  to  £200.  I  am  so  sensible  of 
what  you  say  that  foreigners  have  still  a  very  great  sum 
of  money  in  our  stocks,  that  I  protest  to  you  I  would 
rather  never  see  it  rise  higher  than  it  is,  than  have  it 
raised  for  a  little  while,  only  by  artifices  and  seeming 
advantages.  This  would  give  those  foreigners  an  oppor¬ 
tunity  of  withdrawing  their  money  ;  whereas,  if  it  be 
1  Coxe  :  Memoirs  of  Sir  Robert  Walpole,  II.,  193. 


166 


THE  SOUTH  SEA  BUBBLE 


raised  by  solid  advantages,  and  such  as  will  fix  it  at  a 
moderate  price,  people  will  be  desirous  of  continuing 
their  money  where  it  is,  with  more  security  and  better 
interest,  than  it  can  possibly  be  anywhere  else.  .  .  . 
The  ways  we  must  make  use  of  must  be  such  as  are 
gentle  and  will  by  degrees  raise  credit,  and  give  a  circu¬ 
lation  to  money  again.  This  is  what  must  recover 
our  stock,  and  particular  people  must  retrieve  their 
circumstances  by  frugality  and  a  just  economy.’ 1 

Many  conjectures  were  made  as  to  the  effect  that  the 
return  of  the  King  would  have.  4  A  great  many  flatter 
themselves  with  the  King’s  coming,  though  his  going 
did  not  sink  the  stocks,  and  the  meeting  of  Parliament, 
but  I  wish  it  is  not  past  their  power  to  cure  the  fright 
that  has  seized  everybody,’ 2  Lord  Berkeley  of  Stratton  3 
wrote  to  the  Earl  of  Stafford  on  November  1  ;  and,  ad¬ 
dressing  the  same  correspondent  eleven  days  later,  he 
said  :  4  What  influence  the  King’s  coming  will  have  we 
shall  soon  see.  He  came  to  town  last  night,  as  I  hope 
you  will  soon  do,  to  attend  the  Parliament,  our  last 
refuge.’ 4  Lord  Berkeley  might  well  be  pessimistic, 
for  he  had  suffered  in  the  Mississippi  scheme  as  well  as  in 
the  South  Sea  Company.  4 1  have  so  long  given  over 
my  money  in  France  that  the  trouble  of  it  was  almost 
worn  out  when  my  subscribed  annuities  fell  to  almost 
nothing,’5  he  stated,  philosophically.  Others,  however, 
fondly  cherished  the  belief  that  the  arrival  of  the  King 

1  Pulteney  Papers,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II.,  194. 

2  Wentworth  Papers,  449. 

3  William  Berkeley,  fourth  Baron  Berkeley  of  Stratton  (d. 
1741),  Chancellor  of  the  Duchy  of  Lancaster,  1710-1714 ; 
First  Lord  of  Trade  and  Plantations,  1714. 

4  Wentworth  Papers,  450. 

5  Ibid.,  449. 


THE  NATION  IN  DISTRESS 


167 


would  do  much  to  avert  the  financial  panic.  4  The 
King’s  coming,’  William  Pulteney  wrote  to  Daniel  Pul- 
teney,  November  20,  4  which  everybody  thought  wrould 
have  in  some  measure  reserved  the  stock,  had,  from 
abundance  of  simple  stories  that  have  been  artfully 
dispersed,  rather  depressed  it,  and  within  this  week  the 
stock  has  been  sold  at  £120.’  1 

It  was  known  that  Walpole  was  engaged  upon  a  plan 
for  the  relief  of  the  financial  position,  and  the  whole 
country  was,  of  course,  agog  with  curiosity,  but  all 
that  was  known  outside  official  circles  was  that  the 
Government  was  endeavouring  to  secure  the  co-opera¬ 
tion  of  the  Bank  and  the  East  India  Company.  4  The 
Court,’  Drummond  wrote  to  Daniel  Pulteney,  November 
24,  4  is  taken  up  in  conferring  sometimes  with  the  South 
Sea  Directors  and  the  Bank ;  the  latter,  having  a  con¬ 
ductor,  were  pretty  stubborn,  and  had  a  scheme  of  their 
own,  which  they  insisted  on  ;  but  Lord  Sunderland  said 
to  his  friends,  that  though  they  had  differed  in  their 
way  of  thinking  in  the  private  conference  with  him 
at  his  own  house,  yet  he  parted  very  good  friends  with 
them.  And  common  report  says,  that  a  new  bank  would 
have  been  proposed,  if  the  old  had  not  been  reason¬ 
able.  .  .  .  This  happy  union  [of  Sunderland  and  Wal¬ 
pole]  brought  up  the  stock  again  from  £140  to  £200  and 
£210,  and  it  will  in  all  appearance  remain  about  £200  till 
something  of  the  scheme  be  known,  which  cannot  be 
ready  so  soon  as  the  Parliament  was  to  sit,  and  therefore 
it  was  reported  that  they  were  to  be  prorogued  for  ten 
days.  There  are  premios  given  at  £250  and  £300  ;  but  I 
find  that  few  are  so  sanguine  to  think  that  it  will  be 

1  Pulteney  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  184. 


168 


THE  SOUTH  SEA  BUBBLE 


raised  above  *£300,  and  I  wish  it  may  not  go  much  higher, 
though  if  it  could  be  brought  to  £400,  it  would  save  a 
great  many  who  are  deeply  engaged  ;  but  if  brought  to 
£400,  and  not  supported  there,  a  new  fall  would  do  very 
much  more  harm.  Common  report  says,  that  the  Court 
designs  to  bring  it  to  and  support  it  to  £300,  by  fixing 
a  dividend  of  fifteen  per  cent.,  redeemable  by  Parliament ; 
that  the  debt  due  by  the  public  to  the  Bank  shall  be 
paid  by  the  Company  to  the  Bank  in  stock  at  £300,  and  in 
like  manner  to  the  East  India  Company ;  that  the 
whole  public  debt  is  to  consist  of  £21,000,000  of  capital, 
bearing  fifteen  per  cent,  interest ;  that  national  interest 
is  to  be  reduced  to  three  per  cent.,  and  that  several 
benefits  of  trade  and  fishing  are  to  be  given  to  the  Com¬ 
pany.’  1  Stock  fluctuated  violently  during  this  period 
of  doubt,  the  limits  within  a  fortnight  being,  on  the  one 
hand,  £125  and,  on  the  other,  £215.  ‘  We  are  here  in  a 

most  sad  state  between  hope  and  despair,’  William 
Windham  wrote  to  Ashe  Windham,  November  26. 
‘  Almost  every  one  gives  great  assurances.  Mr.  Walpole 
is  said  often  to  declare  he  thinks  his  scheme  will  do, 
but  the  Parliament  is  put  off,  and  so  stock  falls.’ 2 
One  reason  of  the  prevalent  uneasiness  was  no  doubt 
due  to  the  attitude  of  the  Prince  of  Wales.  c  The  stocks 
still  keep  falling,’  Lady  Irvine  wrote  to  Lord  Carlisle, 
November  17,  c  and  it  is  now  said  that  the  Prince  and 
his  party  are  for  destroying  the  whole  scheme,  and 
either  supporting  the  Bank,  or  erecting  some  other 
Lank  of  credit.  This  report  has  put  most  people  in 

1  Pulteney  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II.,  195.  For  prices  of  South  Sea  stock  at  this  time, 
see  also  a  letter  of  the  same  date  from  Eckersal  to  Daniel 
Pulteney,  Ibid.,  II.,  197. 

2  Ketton  MSS.,  201. 


Francis  Atterbury 

Bishop  of  Rochester 


f>.  168 


THE  NATION  IN  DISTRESS  169 

despair.  Till  to-day  there  has  been  a  report  that  the 
Bank  and  South  Sea  would  agree,  and  things  would 
be  put  upon  so  good  a  foot  the  stock  would  rise  to 

£400.’ 1 

* 


1  Carlisle  MSS.,  25. 


CHAPTER  VII 


Walpole’s  Proposals  for  Restoring  the  Public 

Credit 

DECEMBER,  1720 

PUBLIC  excitement  had  risen  to  fever  heat  when  the 
King  in  person  opened  Parliament  on  December 

8.  Every  one  was  eager  to  hear  what  would  be  said  in 

/ 

the  Speech  from  the  Throne  anent  the  great  disaster. 
As  a  matter  of  fact,  however,  there  was  only  an  indirect 
reference  to  the  catastrophe,  His  Majesty  merely  recom¬ 
mending  the  House  of  Commons  to  4  consider  of  the 
most  effectual  and  speedy  methods  to  restore  the  national 
credit  and  fix  it  upon  a  lasting  foundation.’ 

To  do  this,  it  is  needless  to  sav,  the  faithful  Commons 
required  no  urgency ;  but  they  were  by  no  means 
content  to  confine  their  energies  to  bringing  this  about, 
they  were  determined  to  do  their  utmost  to  seek  out 
and  punish  the  guilty  parties.  The  motion  for  the 
Address  of  Thanks,  moved  by  William  Pulteney  and 
seconded  by  Henry  Pelham,1  contained  an  assurance 
that,  4  This  House  will,  at  this  critical  conjuncture, 

1  Hon.  Henry  Pelham  (1695  ?-1754),  M.P.  for  Seaford,  1717- 
1722,  and  for  Sussex,  1722-1754  ;  Secretary-at-War,  1724  ; 
Paymaster  of  the  Forces,  1730  ;  First  Lord  of  the  Treasury 
and  Chancellor  of  the  Exchequer,  1743.  He  was  a  brother  of 
the  Duke  of  Newcastle. 


170 


RESTORING  CREDIT 


171 


wherein  His  Majesty’s  Government  and  the  interest  of 
his  people  are  so  highly  concerned,  proceed  with  all 
possible  care,  prudence,  and  temper,  to  enquire  into 
the  causes  of  these  misfortunes,  and  apply  the  proper 
remedies  for  restoring  and  fixing  public  credit  upon 
such  solid  and  lasting  foundations  as  may  effectually 
give  ease  and  quiet  to  the  minds  of  His  Majesty’s 
subjects.’ 

This  was  good  so  far  as  it  went,  but  it  did  not  go  far 
enough  to  satisfy  the  majority.  William  Shippen,1 
leading  the  malcontents,  moved  that  after  the  words 
4  for  restoring  and  fixing  public  credit  ’  there  should  be 
added,  4  as  far  as  it  is  consistent  with  the  honour  of 
Parliament,  the  interest  of  the  nation,  and  the  principles 
of  justice.’  4  In  order  effectually  to  remedy  the  present 
misfortune,’  he  contended,  4  it  is  absolutely  necessary 
to  maintain  the  honour  and  faith  of  Parliamentary 
engagements,  and  to  show  the  highest  resentment 
against  those  wrho,  abusing  the  trust  reposed  in  them, 
have  given  so  fatal  a  wound  to  public  credit,  and  enriched 
themselves  by  the  plunder  of  the  nation.’  Nor  was  he 
content  to  leave  it  at  this,  but,  to  the  dismay  of  the 
Court  party,  continued  :  4  In  my  opinion  the  managers 
of  the  South  Sea  project  were  not  the  most  criminal, 
since  there  were  those  above  them  whose  duty  it  was  to 
overlook  and  direct  their  proceedings,  and  who  ought  to 
have  given  a  seasonable  check  to  that  extremity  of 
folly  by  which  South  Sea  stock  and  the  subscriptions 
were  advanced  to  an  extravagant  rate.  Had  those  at 
the  helm  interposed  in  the  affair  of  the  South  Sea,  as 
those  did  in  the  case  of  the  two  Assurances  and  other 

1  William  Shippen  (1673-1743),  M.P.  for  Newton.  Shippen 
was  notorious  for  his  constitutional  support  of  the  Jacobite 
leaders. 


172 


THE  SOUTH  SEA  BUBBLE 


projects,  they  would  have  prevented  that  dismal  calamity 
which  has  since  befallen  the  nation.’ 

In  so  saying  Shippen  was  but  delivering  the  general 
sense  of  the  House,  and  other  members  rose  to  support 
his  attitude.  4  It  would  be  a  disgrace  to  a  British 
House  of  Commons,’  Sir  William  Wyndham1  said 
emphatically,  4  to  show,  on  this  occasion,  less  vigour 
and  spirit  than  the  Parliament  of  Paris,  now  sitting  at 
Pontoise.  That  Parliament  is  justly  looked  upon  as 
the  shadow  of  an  English  Parliament,  yet  it  had  by 
its  firmness  and  resolution  carried  its  point  so  far  as 
to  get  removed  from  the  Administration  that  person 
whom  it  looked  upon  as  the  author  of  the  present  mis¬ 
fortunes  of  France.’  With  more  of  bitterness  Lord 
Molesworth 2  carried  on  the  debate.  4  Before  we  con¬ 
sider  of  the  proper  remedies,’  he  insisted,  4  we  ought  to 
enquire  into  the  cause  and  nature  of  the  distemper.  It 
is  with  the  body  politic  as  with  the  body  natural,  and 
therefore  we  ought  to  imitate  skilful  surgeons,  who,  in 
order  to  cure  a  wound,  begin  with  probing  it,  and,  when 
they  find  it  necessary,  make  incision  and  scarifications 
to  get  the  venomous  cores  out  of  it,  before  they  apply 
healing  plasters.  Those  who  follow  a  contrary  method 
are  but  mere  empirics,  who,  by  using  palliations,  make 
the  sore  rankle  and  fester,  and  endanger  the  life  of  the 
patient.  It  has  been  by  some  suggested  that  there  is 
no  law  to  punish  the  Directors  of  the  South  Sea  Com¬ 
pany,  who  are  justly  looked  upon  as  the  authors  of  the 
present  misfortunes  ;  but,  in  my  opinion,  we  ought  on 
this  occasion  to  follow  the  example  of  the  ancient 

1  Sir  William  Wyndham,  third  baronet  (1687-1740),  M.P 
for  Somershire,  Chancellor  of  the  Exchequer,  1713-1714. 

2  Robert  Molesworth,  first  Viscount  Molesworth  in  the  Irish 
peerage  (1656-1725),  M.P.  for  St.  Michael. 


RESTORING  CREDIT 


173 


Romans,  who,  having  no  law  against  parricide,  because 
their  legislators  supposed  no  son  could  be  so  unnaturally 
wicked  as  to  embrew  his  hands  in  his  father’s  blood, 
made  one  to  punish  so  heinous  a  crime,  as  soon  as  it 
happened  to  be  committed  ;  and  adjudged  the  guilty 
wretch  to  be  thrown  alive,  sewed  up  in  a  sack,  into  the 
Tiber.  As  I  look  upon  the  contrivers  and  executors 
of  the  villainous  South  Sea  scheme  as  the  parricides  of 
their  country,  I  should  be  satisfied  to  see  them  undergo 
the  same  punishment.’  James  Craggs  the  younger  and 
Philip  Yorke,1  on  the  other  hand,  both  urged  that  the 
first  thing  to  do  was  to  restore  the  public  credit,  and 
suggested  that  when  this  was  achieved  it  would  be  time 
enough  to  enquire  into  the  causes  ;  and  they  found  a 
supporter  in  Walpole.  4  I  have  never  approved  the 
South  Sea  scheme,’  he  declared,  4  and  am  sensible  that 
it  has  done  a  great  deal  of  mischief ;  but  since  it  cannot 
be  undone,  I  think  it  the  duty  of  all  good  men  to  give  a 
helping  hand  towards  retrieving  it.  With  this  view,  I 
have  already  bestowed  some  thoughts  on  a  proposal  to 
restore  public  credit,  which,  at  a  proper  time,  I  will 
submit  to  the  wisdom  of  this  House.’ 

Ultimately  Shippen  withdrew  his  amendment  to  the 
Address,  but  the  feeling  was  so  widespread  that,  to  save 
persons  in  high  places,  every  effort  would  be  made  to 
screen  the  offenders,  that  on  the  next  day  a  motion 
moved  by  James  Milner,2 *  and  seconded  by  Jekyll,  that 
the  words  be  added,  4  and  for  punishing  the  authors  of 

1  Philip  Yorke  (1690-1764),  afterwards  first  Earl  of  Hard- 
wicke  ;  held  high  judicial  offices  ;  Lord  Chancellor,  1737-1756. 

2  James  Milner  (d.  1721),  London  merchant,  entered  Parlia¬ 
ment  1717  ;  published  in  1720  ‘  Three  Letters  relating  to  the 

South  Sea  Company  and  the  Bank,’  in  which  he  foretold  the 

disaster  which  resulted  from  the  South  Sea  scheme. 


174 


THE  SOUTH  SEA  BUBBLE 


our  present  misfortunes,5  was  carried  without  a  division, 
those  who  in  their  hearts  objected,  thinking  it  wiser  to 
keep  silent  on  this  occasion. 

The  matter,  however,  was  not  allowed  to  rest  here, 
and  on  December  12,  Grey  Neville  1  moved,  and  Robert 
Pitt  seconded,  ‘  That  the  Directors  of  the  South  Sea 
Company  should  be  ordered  forthwith  to  lay  before  the 
House  an  account  of  their  proceedings  since  December 
25,  171 9. 5  This  took  the  Court  party  by  surprise,  and 
several  spoke,  adducing  arguments  which  they  hoped 
would  result  in  the  proposition  being  withdrawn.  Craggs 
advocated  that  the  House  should  at  present  confine 
itself  to  seeking  a  remedy  for  the  sinking  credit,  and 
then  make  an  enquiry  into  the  causes,  adding  that 
he  could  not  concur  in  any  other  method.  Horatio 
Walpole,2  speaking  on  the  same  side,  admitted  that 
the  South  Sea  scheme  was  weak  in  its  projection, 
villainous  in  its  execution,  and  calamitous  in  its  end, 
but  thought,  notwithstanding,  that  the  first  thing  to 
do  was  to  apply  a  remedy  to  the  evil.  Robert  Walpole 
also  took  this  view,  saying  that  he  had  a  scheme  to 
propose  in  a  few  days,  but  if  the  House  was  in  this  mood 
it  would  certainly  be  declared  impracticable,  and  he 
urged  members  not  at  this  stage  to  embarrass  the  Govern¬ 
ment..  No  one  dared  to  offer  any  excuse  for  the  Directors, 
or  to  urge  that,  if  found  guilty,  they  should  not  be  duly 
punished  ;  they  only  urged  that  any  such  measures 
should  be  postponed  until  steps  had  been  taken  for 

1  Grey  Neville,  of  Bellingbear,  Berkshire  (1681-1723),  M.P. 
for  Berwick-on-Tweed. 

2  Horatio  Walpole  (1678-1757),  diplomatist,  entered  Parlia¬ 
ment  1702  ;  Secretary  of  the  Treasury,  1715-1717  ;  subse¬ 
quently  ambassador  to  various  courts ;  created  Baron  Walpole, 
1756. 


RESTORING  CREDIT 


175 


restoring  the  public  credit.  Delay,  however,  was  exactly 
what  the  House  as  a  whole  deprecated,  and  Jekyll  was 
cheered  to  the  echo  when  he  insisted  upon  the  necessity 
of  examining  immediately  the  conduct  of  the  Directors, 
to  see  whether  they  had  made  good  their  engagements 
and  had  strictly  followed  the  rules  imposed  by  the  Act 
passed  in  the  previous  session  of  Parliament.  This,  he 
protested  vigorously,  was  the  most  natural  way  of  pro¬ 
ceeding  in  an  affair  of  such  importance,  and  he  laughed 
to  scorn  the  idea  of  attempting  to  cure  a  distemper 
before  they  knew  what  it  was.  After  this,  the  dissen¬ 
tients  offered  no  further  opposition,  and  the  motion  was 
accepted.  4  The  motion  of  Saturday  was  yesterday 
put  into  better  form,’  Thomas  Brodrick  wrote  to  Lord 
Middleton  on  December  13,  in  reference  to  this  debate. 
4  The  first  question  moved  was  in  very  strong  terms 
opposed  by  three  or  four,  for,  as  I  remember,  that  was  the 
number.  On  the  other  hand,  members  spoke  with  a 
freedom  becoming  the  British  House  of  Commons. 
The  first  who  spoke  on  the  side  of  the  question  was  my 
quondam  colleague,  Sir  R[ichard]  S[teele].  He  indeed 
set  the  matter  in  a  clear  light,  by  telling  us  that  a  nation 
of  more  wealth  and  greater  credit  than  any  in  Europe, 
within  less  than  two  years,  was  reduced  to  what  we 
see,  and  too  sensibly  feel,  by  a  few  cyphering  citts,  a 
species  of  men  of  equal  capacity  in  all  respects  (that  of 
cheating  a  deluded  people  only  excepted)  with  those 
animals  who  saved  the  Capitol,  who  were  now  to  be 
screened  by  those  of  greater  figure,  for  what  reason 
they  knew  best,  others  were  at  liberty  to  judge.  Another 
[Spencer  Cowper  *]  (in  answer  to  an  argument  against 
the  question,  that  this  vindictive  judgment  so  much 

1  Spencer  Cowper  (1669-1728),  barrister,  M.P.  for  Truro  ; 
judge  of  the  Common  Pleas,  1727. 


17  G 


THE  SOUTH  SEA  BUBBLE 


contended  for,  would  not  attain  the  end  proposed,  for 
that  you  would  not  be  able  to  come  at  the  estates  of 
the  delinquents)  said  he  thought  all  the  laws  against 
bankrupts  being  enacted  into  one  against  the  Directors 
(for  so  he  would  always  call  them,  as  what  carried  more 
of  obloquy  than  any  other  word  could  express)  would, 
in  his  opinion,  attain  the  end  proposed.  Abundance 
spoke  with  equal  bitterness,  and  such  was  the  general 
outcry  that  the  previous  question  which  has  been  de¬ 
manded  was  not  thought  fit  to  be  insisted  upon,  and 
they  were  too  wise  to  discover  their  weakness  by  a 
division  upon  the  main  question.5 1  The  temper  of  the 
House  of  Commons  showed  that  it  was  not  to  be  trifled 
with.  Already,  on  December  14,  members  protested 
against  the  delay  in  the  delivery  of  the  papers  concerning 
the  Company’s  transactions,  although  only  two  days 
had  elapsed  since  they  had  been  demanded,  and  Sir 
Theodore  Janssen1 2  had  assured  the  House  that  they 
were  being  prepared  with  all  possible  dispatch.  They 
were  placed  before  the  House  on  the  following  day,  when, 
after  a  hasty  perusal,  objection  was  at  once  taken  to 
the  vast  sums  lent  by  the  Company  without  due 
authorisation. 

If  it  was  desirable  to  punish  the  offenders,  it  was  even 
more  necessary  forthwith  to  set  about  restoring  the 
public  credit.  It  was  known  that  Walpole  was  to 
present  a  scheme,  but,  although  persons  so  well  informed 
as  Thomas  Harley  could  allude  in  a  letter  to  Lord 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  213. 

2  Four  of  the  Directors  were  members  of  the  House  of 
Commons,  Janssen,  Francis  Eyles,  Sir  Robert  Chaplin,  and 
Jacob  Sawbridge,  but  none  of  them,  except  the  first  named, 
attended  the  sittings. 


RESTORING  CREDIT 


177 


Harley  on  November  29  to  the  principal  features  of 
the  project,1  yet  on  the  whole  the  secret  was  well  pre¬ 
served.  4  The  town  is  left  in  suspense  about  the 
scheme  for  stock-mending  till  next  Thursday,  which 
day  was  proposed  yesterday  by  Walpole.  He  did  not 
open  what  is  in  the  project,  but  negatively  that  bargains 
were  not  to  be  dissolved,  but  left  to  the  law,  and  that 
no  new  tax  was  to  be  laid  to  help  the  stock,’  Thomas 
Harley  wrote  to  Lord  Harley  on  December  10.  ‘It  is 
said  the  dividend  is  to  be  sixteen  per  cent.,  but  there 
are  so  many  disbelievers  that  South  Sea  is  sold  at  150, 
In  a  short  time  the  books  will  be  shut,  then  stock  may  rise 
in  denomination,  for  people  will  not  trust  one  another 
so  much  as  to  sell  for  time.’ 2  Walpole  had,  indeed, 
already  prepared  a  scheme,  but  it  is  only  fair  to  say 
that  though  all  the  credit  was  given  to  him,  it  was  first 
adumbrated  by  Jacombe.  ‘  When  I  waited  on  Lord 
Townshend,  he  was  pleased  to  talk  with  me  on  what 
could  or  ought  to  be  done  for  the  South  Sea  Company,’ 
Jacombe  had  written  to  Walpole,  October  11.  ‘I 
mentioned  a  thought  of  mine  that  would  be  best  for  the 
interest  of  the  nation,  if  instead  of  adding  more  to  the 
Company,  their  capital  was  divided  amongst  the  three 
great  bodies,  the  Bank  [of  England],  the  South  Sea  and 
India  Companies  ;  thereby  making  them  more  equal, 
but  upon  separate  interests,  as  checks  on  one  another, 
and  consequently  less  powerful  and  less  dangerous  to 
the  State.  He  was  pleased  with  the  thought,  and  com¬ 
mended  me  to  consider  how  it  might  be  practicable. 
I  promised  him  to  do  so  against  your  return  to  London. 
I  have  since  thought  more  closely  of  it,  and  do  believe, 
though  there  are  difficulties,  yet  that  it  is  practicable 

1  Portland  MSS.,  V.,  60G. 

2  Ibid.,  008. 

N 


178 


THE  SOUTH  SEA  BUBBLE 


and  advisable.  When  you  come  to  town,  I  believe  I 
shall  be  able  to  lay  a  short  plan  of  it  before  you,  and 
submit  it  to  your  judgment.’  1 

When  Walpole  submitted  his  plan  to  the  King,  he 
prefaced  it  with  the  statement  that  he  had  been  reluctant 
to  take  any  hand  in  the  matter,  and,  indeed,  had  yielded 
only  in  obedience  to  the  royal  commands,  because  he 
was  sensible  of  the  many  difficulties  that  would  attend 
any  plan  for  the  relief  of  the  sufferers,  and  because  it 
was  utterly  impossible  to  devise  any  method  by  wThich 
satisfaction  could  be  given  to  the  stock-holders.  4  The 
public  security,  and  the  restoring  and  establishing  public 
credit  in  which  your  Majesty’s  Government  is  so  highly 
concerned,  are  first  to  be  consulted,  and  this,  I  hope, 
may  by  this  means  be  effectually  settled  and  secured,’ 
he  continued.  4  A  due  and  compassionate  regard  is  to 
be  shown  to  the  losses  of  private  men,  and  all  that  I 
conceive  can  be  expected,  is  to  give  some  ease  and 
relief  to  the  present  unhappy  circumstances,  in  which 
great  numbers  are  now  involved  ;  but  it  seems  to  me 
impossible,  so  far,  to  repair  every  man’s  losses,  that  a 
great  many  will  not  still  remain  considerable  losers.’ 
The  first  duty,  then,  being  to  put  the  public  credit  on  a 
sound  basis,  the  individual  must  go  to  the  wrall.  It 
wrould,  of  course,  have  been  easy,  by  financial  jugglery, 
to  raise  for  awhile  the  price  of  the  stock  ;  but,  as  Wal¬ 
pole  pointed  out,  any  attempt  to  do  so  would  only 
involve  a  new  set  of  persons  in  the  misfortunes,  so  this 
course  was  entirely  opposed  to  any  sound  policy.  4  What 
I  desire,’  Walpole  said  in  conclusion,  4  may  be  observed 
through  this  scheme  is,  that  I  take  everything  as  I 
found  it,  and  do  nothing  to  alter  any  man’s  circum¬ 
stances,  but  by  an  accession  of  profit,  from  the  Bank 
1  Coxe  :  Memoirs  of  Sir  Robert  Walpole,  III.,  193. 


RESTORING  CREDIT 


179 


and  India  Company,  and  by  an  impartial  distribution 
of  the  whole,  as  it  now  appears,  from  the  public  trans¬ 
actions  of  the  Company,  and  have  carefully  avoided, 
either  to  enforce  or  release  any  public  or  private  con¬ 
tract  or  obligation,  or  to  ease  or  relieve  any  one  sort  of , 
adventurers  at  the  loss  and  expense  of  another.’  After 
these  preliminaries  the  scheme  was  outlined  : — 

4  That  the  first  money-subscription  at  £300  per  cent, 
be  completed,  all  future  payments  to  be  made  in  South 
Sea  bonds,  and  allowing  longer  time  for  the  same,  to 
make  them  less,  and  more  easy. 

4  That  stock  be  given  for  the  moneys  already  paid  in, 
upon  the  second,  third,  and  fourth  money-subscriptions 
at  £400  per  cent,  with  the  Midsummer  dividend,  and 
that  all  future  payments  thereon  be  discharged. 

4  That  the  stock  which  shall  then  remain  undisposed 
of,  be  divided  among  the  present  proprietors  of  stock, 
in  proportion  to  their  several  interests,  and  thereby 
an  end  put  to  the  selling  any  more  stock  by  subscription. 

4  That  the  increased  capital  of  the  South  Sea  stock, 
amounting  in  the  whole  to  £38,000,000,  or  thereabouts, 
be  divided  into  three  parts,  £20,000,000  to  remain  to 
the  capital  of  the  South  Sea  stock,  £9,000,000  to  be 
ingrafted  into  the  Bank  stock,  and  £9,000,000  to  be 
ingrafted  into  the  East  India  Company,  at  £120  per  cent., 
and  the  fund  from  the  Exchequer  to  attend  this  dis¬ 
tribution,  but  the  parts  of  the  Bank  and  East  India 
Company  to  be  all  five  per  cent.  Each  Company  to 
have  its  proportion  of  the  charges  of  management 
allowed  by  the  public. 

4  That  each  proprietor  of  South  Sea  stock  shall  have 
his  proportion  in  the  new  ingrafted  public  stock  of  each  of 
the  respective  companies,  according  to  this  distribution. 
That  ail  profits  which  have  hitherto  arisen,  by  sale  of 


180 


THE  SOUTH  SEA  BUBBLE 


stock  by  subscription,  amounting  to  £15,450.000,  shall 
remain  for  the  benefit  of  the  £20,000,000  South  Sea 
stock,  subject  to  all  charges  and  encumbrances. 

4  That  all  future  privileges  and  advantages,  to  be 
granted  by  the  public,  shall  likewise  remain  for  the 
benefit  of  the  £20,000,000  South  Sea  stock. 

4  That  any  further  reasonable  privileges  and  advan¬ 
tages  be  granted  to  the  Bank  and  India  Company,  to 
induce  and  enable  them  to  admit  this  ingraftment.’ 

Walpole,  by  way  of  explanation,  appended  to  these 
proposals  some  carefully  considered  observations : — 

4  This  method  puts  an  end  to  the  great  demand  for 
money  that  arises  from  time  to  time  by  sale  of  stock 
by  subscription,  which  alone  has  the  town  under  such 
constant  distress  for  money  upon  every  payment,  that 
whilst  that  subsisted,  it  was  impossible  for  credit  to 
revive  ;  the  payments  to  be  made  between  the  14th  of 
November,  1720,  and  the  14th  of  August,  1721,  both 
inclusive,  amounting  to  £8,478,600  with  the  compass 
of  six  months,  which  were  to  be  continued  on,  till  the 
whole  subscription  has  been  completed,  which  would 
not  have  ended  till  the  2nd  of  July,  1725,  but  are  not 
to  be  totally  discharged.  Every  subscriber  has  great 
ease  and  relief  from  this  alteration,  by  being  obliged  to 
take  only  £250  stock  at  £400  per  cent,  who  is  no  wobliged 
to  take  £l, 000  stock  at  the  same  price;  and  when  the 
Midsummer  dividend  of  £10  per  cent,  in  stock,  making 
£25  stock,  shall  be  added  to  the  £250  stock,  and  the 
future  dividend  in  stock  undisposed  of,  after  the  execu¬ 
tion  of  this  scheme,  amount  to  above  £46  per  cent,  in 
stock,  shall  be  added  to  the  £275  stock,  every  subscriber, 
for  £1,000  paid,  will  receive  £401  10s.  stock. 

4  The  same  computation  holds  upon  every  £1,000  in 
the  redeemable  funds,  receiving  stock  at  the  same  price, 


RESTORING  CREDIT 


181 


with  the  same  dividends  in  stock.  The  dividend  of  the 
stock  undisposed  of  upon  the  capital,  puts  an  end  to 
all  future  sales  of  stock  by  subscription,  which  not  only 
prevents  the  former  mischief  from  being  repeated,  but 
puts  every  proprietor  in  immediate  possession  of  his 
just  share,  arising  from  the  profits  of  the  whole,  without 
waiting  for  annual  dividends,  subject  to  the  manage¬ 
ment  of  Directors,  and  the  sundry  chances  and  hazards 
that  payments  to  be  received  in  a  long  course  of  time  are 
liable  to  ;  and  every  proprietor  not  only  receives  his 
share  of  profit  arising  from  the  South  Sea  scheme,  but 
has  likewise  a  further  advantage  upon  the  whole,  by 
the  ingraftment  of  one-half  of  his  increased  capital  into 
the  Bank  and  East  India  Company. 

4  This  distribution,  by  ingrafting  £9,000,000  into  the 
Bank,  and  £9,000,000  into  the  East  India  Company, 
reduced  the  capital  of  the  South  Sea  stock  to  £20,000,000. 
The  reduction  alone  remedies  some  of  the  greatest  mis¬ 
chiefs  that  attended  the  whole  scheme.  A  capital  of 
£40,000,000  is,  from  its  bulk  alone,  impracticable,  and, 
if  raised  to  any  advanced  price  in  any  high  degree, 
cannot  possibly  be  negotiated,  not  only  for  want  of 
sufficient  specie  or  paper  money,  but  for  want  of 
property.  Suppose  a  capital  of  £40,000,000  raised  to 
£l,000  per  cent.,  the  value  is  £400,000,000  :  it  is  not  to 
be  conceived  that  all  the  property  of  England  can 
answer  such  an  immense  and  such  an  imaginary  value, 
much  less  that  any  sort  of  money  can  be  found  to  nego¬ 
tiate  one  half  of  it.  It  is  impossible  to  find  any  profits 
that  can  supply  a  dividend  upon  so  large  a  capital  at  any 
advanced  price ;  but  the  capital  being  reduced  to  one- 
half,  all  profits  and  advantages  that  can  be  reasonably 
given  to  support  the  scheme  are  double  upon  the  half 
to  what  they  would  be  upon  the  wrhole.  And  by  this 


182 


THE  SOUTH  SEA  BUBBLE 


proposal  all  profits  that  have  arisen  already  by  the 
sale  of  stock,  and  all  future  advantages  to  be  granted 
by  the  public,  are  reserved  for  the  £20,000,000  of  South 
Sea  stock.  And  as  every  proprietor  is  to  have  his  just 
proportion  in  each  part  of  the  distribution,  he  partakes 
in  the  advantages  reserved  for  the  South  Sea  Company 
in  as  full  a  manner  as  if  his  whole  had  remained  there. 
Besides  the  profits  arising  in  the  South  Sea  Company, 
he  likewise  receives  Bank  stock  at  £120  per  cent.,  com¬ 
puted  at  160  per  cent.,  and  India  stock  at  £120  per  cent., 
computed  at  200  per  cent. ;  and  for  the  interest  of  his 
money  he  will  in  all  probability  receive  £8  per  cent,  per 
annum  from  the  Bank  and  £10  per  cent,  per  annum  from 
the  East  India  Company,  in  lieu  of  the  Exchequer 
annuity  of  £5  per  cent,  per  annum  upon  each,  which 
are  now  to  be  transferred  to  the  Bank  and  India  Company. 

4  And  although  every  proprietor  gives  £120  per  cent, 
for  the  Bank  stock,  which  he  is  to  have  in  his  own  right, 
the  £20  per  cent,  upon  the  £9,000,000  to  be  ingrafted  into 
the  bank,  making  in  the  whole  £1,500,000,  is  reserved 
for  the  common  benefit  of  the  whole  Bank,  in  which 
every  proprietor  is  to  have  his  just  share,  and  this 
reduces  the  price  given  for  Bank  stock  to  £lll  5s. , 
or  thereabouts  ;  so  that  every  South  Sea  proprietor  gains 
of  one-fourth  of  his  South  Sea  stock  about  40  per  cent, 
in  the  advanced  price  of  Bank  stock,  and  upon  one-fourth 
about  £80  per  cent,  in  the  advanced  price  of  India  stock  ; 
or,  in  another  view,  for  the  £20  per  cent,  which  he  pays 
for  Bank  stock  above  par  he  will  receive  an  additional 
dividend  of  3  per  cent,  per  annum,  and  for  the  £20  per 
cent,  paid  for  India  stock  above  par  £5  per  cent,  per 
annum  ;  and  this  is  most  evidently  an  addition  of  so 
much  to  every  man’s  property  in  the  South  Sea  stock. 

4  Besides  these  private  advantages,  this  distribution 


Horace  Walpole 
Afterwards  Earl  of  Orford 

From  a  fainting  by  Nathaniel  Horne 


p.  182 


RESTORING  CREDIT 


183 


of  this  great  capital,  with  regard  to  the  Government 
and  the  public,  was  almost  necessary,  and  being  now 
divided  between  the  three  great  bodies  and  companies 
of  the  City,  establishes  such  a  balance  of  power  among 
them,  as  may  make  them  all  useful  to  the  public.  The 
capital  of  the  South  Sea  Company  will  now  be 
£20,000,000,  the  capital  of  the  Bank  £14,500,000,  the 
capital  of  the  India  Company  £12,200,000  ;  and  as  the 
public  has  been,  and  frequently  must  be,  obliged  to  apply 
to  these  corporate  bodies  for  the  support  of  public  credit, 
the  public  will  not  be  under  the  necessity  to  accept  the 
hard  terms  which  one  single  powerful  body  might  be 
inclined  to  impose,  when  all  three  are  in  a  condition  to 
aid  and  assist  upon  any  emergency,  and  this  has  been 
verified  by  constant  experience.’1 

It  was  expected  by  the  Commons  that  this  scheme 
would  be  put  before  it  on  December  15,  but  on  the  day 
in  question  Walpole  declared  that  no  proposal  likely 
to  prove  effective  could  be  proposed  until  Parliament 
had  determined  whether  or  no  the  annuitants  should 
be  held  to  their  subscriptions,  made  in  August.  Five 
days  later,  therefore,  Walpole  took  the  sense  of  the 
House  by  moving,  ‘  That  the  proprietors  of  subscrip¬ 
tions  redeemable  and  unredeemable,  and  all  other  con¬ 
tracts  with  the  South  Sea  Company,  should  continue  in 
their  present  state,  unless  mitigated  to  the  several 
proprietors  by  a  General  Court  or  discharged  of  their 
several  contracts  by  a  due  course  of  law.’  This  was 
pressed  to  a  division  and  was  carried  by  267  to  117  votes, 
the  Tories  supporting  the  Court  party.  At  last,  on 
December  22,  Walpole  unfolded  his  scheme.  The  vari¬ 
ous  opinions  expressed  about  it  are  reflected  in  the 
following  correspondence :  ‘  Our  scheme  was  yesterday 
1  Coxe  :  Memoirs  of  Sir  Robert  Walpole,  II.,  107, 


184 


THE  SOUTH  SEA  BUBBLE 


opened  by  Mr.  Walpole,  who,  with  the  greatest  skill 
imaginable,  entrenched  himself  by  telling  us  that  he 
took  for  granted  things  were  as  they  are  laid  before  us, 
cujus  contrarium ;  and  in  speaking  his  thoughts,  as  he 
termed  it,  at  least  six  times  desired  it  might  be  remem¬ 
bered  that  he  argued  upon  this  supposition,’  Thomas 
Brodrick  wrote  to  Lord  Middleton.  ‘  The  substance  in 
short  was  this  :  that  of  the  £38,000,000  now  invested 
in  the  South  Sea  Company,  £9,000,000  should  by  way 
of  ingraftment  be  vested  in  the  Bank,  as  much  in  the 
East  India  Company,  and  the  remaining  £20,000,000 
remain  to  the  South  Sea.  The  money  account,  he  said, 
he  did  not  care  to  meddle  with  ;  and  he  was  in  the  right, 
for  when  that  shall  be  discussed  (if  ever  it  be)  it  will 
not  bear  an  examination.  After  many  long  speeches, 
to  very  little  purpose,  it  was  understood  that  the  House 
would  be  ready  to  receive  proposals  from  these  three 
great  bodies,  which  we  shall,  I  think,  agree  to,  be  they 
what  they  will,  for  the  same  reason  (for  they  will  be 
plentifully  made  use  of)  which  induced  us  to  pass  the 
Bill  last  Session.  I  then  told  you  what  I  thought 
would  be  the  issue,  which  to  my  great  grief  proves  too 
rightly  judged.  I  will  now  tell  you  my  fears  of  this 
matter.  That  Mr.  Walpole  made  the  most  of  every¬ 
thing  is  very  certain ;  and  supposing  his  postulata  (to  use 
his  own  word)  well  grounded,  his  conclusions  were 
right.  But  my  opinion  is  that  skimming  over  the  sore, 
without  probing  the  wound  to  the  bottom,  will  end  in  its 
breaking  out  again,  when  possibly  the  malignity  may 
be  too  great  to  overcome  ;  but  we  are  for  putting  off 
the  evil  day,  and  he  is  a  fool  or  knave  who  joins  not 
therein.’ 1  The  principal  fear  that  oppressed  Brodrick 

1  December  22,  1720  ;  Middleton  Papers,  quoted  in  Coxe’s 
Memoirs  of  Sir  Robert  Walpole ,  II.,  204. 


RESTORING  CREDIT 


185 


was  that  the  guilty  would  escape,  owing  to  the  interest 
taken  in  the  matter  of  restoring  the  public  credit, 
which,  in  his  opinion,  should  come  second  to  vengeance. 
1  The  scheme  for  restoring  credit,’  Thomas  Harley  in¬ 
formed  Lord  Harley,  4  has  been  opened  in  the  House 
which  met  with  little  opposition,  and  yet  the  stock  is 
lower  than  it  was.  The  members  are  as  docile  as  one 
would  wish,  but  when  stock  comes  to  be  put  in  the 
balance  against  specie,  there  is  not  enough  of  this  com¬ 
modity  to  carry  on  jobbing  to  the  height  it  was  in  the 
late  age  of  paper.  The  owners  of  stock  and  subscription 
complain,  but  the  annuitants  cry  out  aloud.  Among 
the  advantages  to  be  given  to  the  South  Sea,  they  are 
to  have  Nova  Scotia,  from  whence  naval  stores  are  to 
come.  Mr.  Secretary  Craggs  said  in  the  House,  if 
Law  had  concluded  his  bargain  with  the  Czar  for  all  the 
produce  of  Muscovy,  we  must  have  been  supplied  from 
Arcadie.  They  are  likewise  to  have  some  pretty  island 
in  those  parts,  which  is  not  yet  peopled,  and  therefore 
more  valuable,  there  being  no  one  to  hinder  the  planting 
right  principles.’  1 2  Daniel  Pulteney  also  had  something 
to  say  on  the  subject.  4  After  a  good  deal  of  private 
management,  in  which  the  public  was  very  little  con¬ 
sidered,’  he  wrote  to  the  Hon.  John  Molesworth,2  4  Mr. 
Walpole  has  produced  a  scheme  for  the  South  Sea, 
which,  in  my  opinion,  is  liable  to  many  objections,  one, 
I  think,  very  material.  It  obliges  the  proprietors  of, 
and  subscribers  to,  the  South  Sea,  to  take  one-fourth 

1  December  22,  1720  ;  Portland  MSS.,  V.,  610. 

2  The  Hon.  John  Molesworth  (1679-1726)  was  the  eldest 
son  of  Robert  Molesworth,  first  Viscount  Molesworth,  to  whose 
title  he  succeeded  in  1725.  He  was  appointed  a  Commissioner 
of  Trade  in  1715,  and  subsequently  undertook  several  diplomatic 
missions, 


186 


THE  SOUTH  SEA  BUBBLE 


of  their  stock  in  Bank  and  another  fourth  in  East  India 
stock  at  a  fixed  rate.  I  don’t  like  either  of  these  stocks ; 
must  I  take  them  against  my  will  and  contrary  to  my 
judgment  ?  This  is  compulsive  disposal  of  private 
property,  which,  I  believe,  was  never  practised  before 
by  Parliament.’ 1 


1  December  18,  1720  ;  Clements  MSS.>  289. 


CHAPTER  VIII 


Parliamentary  Measures 

JANUARY,  1721 

DURING  the  Christmas  recess  there  were  many 
rumours  as  to  the  course  which  would  be  taken 
in  connection  with  those  responsible  for  the  mismanage¬ 
ment  of  the  Company.  4  The  House  is  preparing  to 
examine  into  the  ill-practices  of  the  South  Sea  Directors,5 
Sir  James  Lowther  1 2  wrote  to  Lord  Carlisle,  December 
29,  4  and  have  for  that  purpose  ordered  them  to  lay 
before  the  House  their  reasons  for  resolving  to  make 
dividends  of  fifty  per  cent.,  and  for  promoting  sub¬ 
scriptions  at  £1,000,  it  being  evident  that  those  proceed¬ 
ings  have  brought  on  this  calamity  and  misery  upon  the 
nation.5  2 

When  the  Commons  reassembled  on  January  4,  Jekyll 
at  once  moved,  4  That  leave  be  given  to  bring  in  a  Bill 
for  restraining  the  Sub-Governor,  Deputy- Governor, 
Directors,  Treasurer  or  Cashier,  and  Accountants  of  the 
South  Sea  Company  from  going  out  of  this  kingdom  for 
the  space  of  one  year,  and  until  the  end  of  the  next 
session  of  Parliament ;  and  for  discovering  the  estates 

1  Sir  James  Lowther,  bart.,  of  Whitehaven  (d.  1755),  M.P, 
for  Cumberland. 

2  Carlisle  MSS. 


187 


188 


THE  SOUTH  SEA  BUBBLE 


and  effects,  and  from  preventing  the  transporting  or 
alienating  the  same.’  No  one  venturing  to  oppose  the 
suggestion,  it  was  ordered  by  the  House  that  the  Bill 
should  be  introduced.  This,  however,  did  not,  in  the 
opinion  of  many  members,  go  far  enough  to  please  all, 
and  Shippen  was  voicing  a  popular  sentiment  when  he, 
while  expressing  his  approval  of  the  measure  to  secure 
the  persons  and  estates  of  the  Directors  and  officers  of 
the  Company,  said  that  in  his  opinion  there  were  some 
men  in  great  stations,  whom  he  would  name  in  due 
course,  who  were  no  whit  less  guilty.  Then  ensued  an 
extraordinary  scene.  No  sooner  had  Shippen  sat  down, 
than  James  Craggs  the  younger,  apparently  feeling 
acutely  that  the  cap  fitted  him  better  than  most  present, 
jumped  up  and  cried  angrily,  that  he  was  ready  to  give 
satisfaction  to  any  one  that  should  question  him,  either 
in  the  House  or  out  of  it.  This  caused  an  immense 
sensation,  for  in  those  duelling  days  there  was  but  one 
interpretation  to  put  upon  the  phrase.  Lord  Moles- 
worth  took  it  upon  himself  to  act  as  spokesman  for  the 
excited  assembly,  and  he  rebuked  the  last  speaker  with 
spirit.  ‘  I  have  had  the  honour  to  be  a  member  of  this 
House  upwards  of  thirty  years,5  he  said,  ‘  and  never 
before  now  have  known  any  man  bold  enough  to  chal¬ 
lenge  the  whole  House  of  Commons  and  all  England 
besides.  For  my  part,  though  past  sixty,  I  will  answer 
whatever  the  Right  Hon.  Gentleman  has  to  say  within 
the  House,  and  I  hope  that  there  are  younger  members 
enough  who  are  not  afraid  to  look  him  in  the  face  out  of 
the  House.5  In  reply,  Craggs,  having  regained  control 
of  his  temper,  declared  that  he  had  been  misunderstood, 
and  that  by  giving  satisfaction  he  had  merely  meant 
clearing  his  character. 

The  Directors’  Bill,  as  it  was  commonly  called,  was 


PARLIAMENTARY  MEASURES 


189 


a  very  popular  measure.  4 1  wish  the  Parliament  was 
able  to  afford  suitable  remedies  to  the  present  malady,’ 
Sir  William  Robinson 1  wrote  to  Lord  Carlisle.  4  The 
calamity  is  so  universal  that  infinite  numbers  must 
suffer,  if  we  were  unanimous  in  applying  proper  plasters 
to  the  hurts  done  to  all  degrees  of  people  by  the  vile 
practices  of  the  Directors.  There  seems  a  spirit  in 
both  Houses  to  pursue  them  to  condign  punishment.’  2 
Popular,  too,  was  the  appointment  of  a  Committee, 
of  Secrecy  to  investigate  the  whole  business.  4  There  is 
no  danger  but  enough  will  be  proved  against  them — it 
is  illegal  to  buy  stock  in  corporate  capacity,  unwarrant¬ 
able  to  lend  money  on  subscriptions ;  but  the  top 
Directors  have  a  hundred  things  to  answer  for,’  James 
Windham  wrote  to  Ashe  Windham  on  January  5.  4  The 

town  is  very  much  rejoiced  at  this  vigour  in  the 
Commons,  for  it  was  shrewdly  suspected  the  Court  did 
desire  to  screen  the  Directors  for  fear  it  might  draw 
in  Craggs.  As  for  Aislabie,  he  must  fall,  for  he  has 
at  least  been  guilty  of  as  much  villainy  as  any  of 
them.’ 3 

Much  depended  upon  the  composition  of  the  Committee 
of  Secrecy,  which  was  to  be  elected  by  ballot,  and  each 
side  strained  every  nerve  to  influence  the  issue.  4 1 
suppose  you  will  have  the  list  of  the  Committee  sent  you 
by  several  people,  but  it  is  now  eight  at  night,  and  the 
House  of  Commons  is  yet  sitting,  and  for  fear  none  of 
your  friends  should  have  time  to  write,  I  enclose  it,’ 

1  Sir  William  Robinson,  of  Newby,  Yorkshire  (1655-1736), 
M.P.  for  York,  1697-1722.  He  had  married  Mary,  eldest 
daughter  of  George  Aislabie  of  Studley  Royal,  a  niece  of  John 
Aislabie,  the  late  Chancellor  of  the  Exchequer. 

2  Carlisle  MSS.,  27. 

3  Ketton  MSS. 


190 


THE  SOUTH  SEA  BUBBLE 


Lady  Elizabeth  Lechmere  1  wrote  to  Lord  Carlisle  on 
January  10.  4  If  you  saw  the  Court  list,  you’ll  find 

Sir  Joseph  Jekyll  and  Mr.  Wortley  2  are  the  only  two 
men  that  were  in  it  that  were  chosen,  so  that  I  believe 
there  is  some  disappointment  in  some  places.  Sir 
William  Thomson 3  was  one  of  the  Court  list,  but  I  did 
not  hear  of  anybody  besides  themselves  that  thought 
he  was  a  fit  man  to  enquire  into  what  related  to  corrup¬ 
tion.’  4  Eleven  days  later  Lady  Elizabeth  again  referred 
to  the  same  matter  in  another  letter  to  the  same  corre¬ 
spondent.  4  As  to  what  you  say  about  the  Committee,’ 
she  wrote,  4 1  believe  it  is  generally  thought  to  have  been 
a  great  deal  laboured  by  the  Court  to  carry  their  list,  and 
for  their  interest  to  do  so  ;  and  those  who  are  of  this 
side  say  it  appeared  to  be  their  intention  to  baffle  the 
enquiry,  and  carrying  their  list  would  have  done  it  in  the 
most  effectual  manner.’ 5  The  names  of  the  members 
to  serve  on  the  Committee  were  announced  on  January 
11  :  Thomas  Brodrick  (chairman),  William  Clayton,6 

1  Lady  Elizabeth  Howard  (d.  1739),  daughter  of  Charles, 
third  Earl  of  Carlisle,  married  Nicholas,  afterwards  Baron, 
Lechmere.  His  widow  in  1728  married  Sir  Thomas  Robinson, 
bart.  (1700  ?-1777). 

2  The  Hon.  Edward  Wortley  Montagu  (1678-1761),  M.P. 
for  Westminster,  the  husband  of  Lady  Mary  Wortley  Montagu, 
the  author  of  the  4  Letters.’ 

3  Sir  William  Thomson  (1678-1739),  M.P.  for  Ipswich  ; 
Solicitor- General,  1717-1720  ;  Cursitor  Baron,  1726  ;  Puisne 
Baron  of  the  Exchequer,  1729. 

4  Carlisle  MSS.,  26. 

6  Ibid.,  27. 

6  William  Clayton,  M.P.  for  Bletchingley.  He  was  the 
nephew  and  heir  of  Sir  Robert  Clayton  (1629-1707),  the  London 
merchant  and  philanthropist,  who  acquired  the  estates  of 
Bletchingley  and  Marden  from  Lord  Peterborough  and  Sir  John 
Evelyn,  respectively.  William  Clayton  was  created  a  baronet 
in  1732. 


PARLIAMENTARY  MEASURES 


191 


Archibald  Hutcheson,  Edward  Jeffreys,1  Sir  Joseph 
Jekyll,  Nicholas  Lechmere,  Lord  Molesworth,  Sir 
Thomas  Pengelly,2  General  Ross,3  William  Sloper,4 * 
Colonel  Thomas  Strangeways,6  The  Hon.  Dixie  Windsor,6 
and  the  Hon.  Edward  Wortley  Montagu. 

Lady  Elizabeth  Lechmere  in  her  letter  of  January  10 
to  Lord  Carlisle  noted  that  the  House  of  Commons  sat 
until  late,  but  the  business  which  engaged  it  was  not 
concerned  with  the  Committee  of  Secrecy,  but  the 
resolution  for  ingrafting  South  Sea  stock  upon  the 
respective  stocks  of  the  Bank  and  the  East  India  Com¬ 
pany,  a  matter  which  was  warmly  debated  in  a  crowded 
House.  c  Though  the  Court  lost  their  list  upon  the 
ballot  for  a  Secret  Committee  to  roast  South  Sea 
Directory,  yet  Mr.  Walpole’s  scheme  was  carried  yester¬ 
day  after  a  long  debate  by  a  great  majority  :  opposed 
and  spoken  against  by  [Sir  Joseph  Jekyll]  the  Master 
of  the  Rolls,  Mr.  Smith,  Hutcheson,  Sloper,  Pitt,  Ship- 
pen,  etc.,’  Edward  Harley  wrote  to  Lord  Oxford.  ‘  Thus 
Bank,  India,  and  South  Sea  Companies  are  now  put  upon 
one  bottom,  and  must  sink  or  swim  together ;  but 
figures  are  come  in  fashion  again  in  the  city,  and,  there¬ 
fore,  they  presume  to  say  that  this  will  be  a  scheme  for 
two  months’  stock- jobbing,  and  then  all  sink  together.’ 7 

1  Edward  W.  Jeffreys,  M.P.  for  Droitwich. 

2  Sir  Thomas  Pengelly  (1675-1730),  serjeant-at-law  ;  M.P. 
for  Cockermouth  from  1717  ;  chief  Baron  of  the  Exchequer, 
1726-1730. 

3  The  Hon.  C.  Ross,  M.P.  for  Ross. 

4  William  Sloper,  M.P.  for  Bedwin. 

6  Colonel  Thomas  Strangeways,  M.P.  for  Dorsetshire. 

6  The  Hon.  Dixie  Windsor  (1672-1743),  younger  son  of 
Thomas  Windsor,  first  Earl  of  Plymouth,  and  brother-in-law 
of  William  Shippen.  He  represented  the  University  of  Cam¬ 
bridge  in  six  successive  Parliaments. 

7  Portland  MSS.,  V.,  612. 


192 


THE  SOUTH  SEA  BUBBLE 


Edward  Harley  was  not  alone  among  the  pessimists, 
4  Though  Mr.  Walpole’s  scheme  was  carried  in  the 
House  by  a  great  majority,’  Sir  William  Robinson  wrote 
to  Lord  Carlisle  on  January  12, 4  yet  I  find  the  City  does 
not  relish  the  project  of  ingrafting  nine  millions  to  the 
Bank  and  India  Companies,  believing  the  stock  cannot 
rise  above  200,  which  will  not  answer  the  expectations 
of  the  poor  annuitants,  nor  the  subscription  people  ; 
but  if  some  further  aid  of  Parliament  could  be  had,  to 
raise  the  stock  to  300,  most  people  would  sit  down 
tolerably  easy  under  their  respective  losses.’  1 

The  Directors’  Bill  was  rapidly  pushed  forward.  It 
was  read  a  first  time  on  January  10,  a  second  time  on 
the  following  day,  and  reached  the  Committee  stage 
forty-eight  hours  later.  In  its  final  form  it  prohibited 
the  Directors  leaving  the  kingdom  for  a  year  and  before 
the  end  of  the  next  session  of  Parliament,  and  required 
them  to  enter  into  recognisances  of  £100,000,  with  two 
sureties  of  £25,000  each,  for  the  observance  of  this 
condition ;  it  ordered  the  delivery  of  an  inventory  of 
their  estates  real  and  personal  upon  oath,  and  enacted 
that  if  they  should  be  found  guilty  of  a  false  return  they 
should  be  guilty  of  felony.  The  Directors,  alarmed  by 
the  severity  of  the  Bill,  petitioned  to  be  heard  by  counsel 
in  opposition.  4  This,’  Brodrick  WTote  to  Lord  Middle- 
ton,  4  was  rejected  with  the  utmost  indignation,  although 
supported  by  some  of  our  great  men  (which  by  the  way 
was  very  ill  relished)  not  only  in  favour  of  the  Directors, 
but  on  account  of  justice,  for  that  no  criminal  (how 
great  soever)  ought  to  be  condemned  unheard.  To 
which  it  was  answered,  that  this  Bill  did  not  condemn, 
the  chief  end  being  only  to  secure  their  standing  a  trial, 
and  preventing  alienation  of  their  estates  till  such  times 

1  Carlisle  MSS.,  27. 


PARLIAMENTARY  MEASURES 


193 


as  their  trial  was  over.  It  was  then  said,  even  thus 
much  would  be  inflicting  a  great  punishment  unheard  ; 
to  which  it  was  replied  that  surely  gentlemen  had  not 
read  over  the  papers  and  accounts  delivered  at  the  bar 
•by  themselves,  for  that  by  these  the  most  notorious 
breach  of  trust  (against  the  tenour  and  purport  of  the 
South  Sea  Act,  as  well  as  against  their  own  by-laws) 
were  confessed,  that  therefore  the  case  was  no  more 
or  other  than  committing  or  requiring  bail  from  a  crimi¬ 
nal  upon  confession,  according  to  the  nature  of  the 
offence  ;  that  from  the  notoriety  of  the  thing  as  well  as 
from  national  prejudice  sustained  thereby,  the  Legis¬ 
lature  were  now  doing  what  in  ordinary  cases  the 
magistrate  might  and  ought  to  do.  The  House  was, 
from  a  coolness  of  temper,  wrought  up  to  a  great  height, 
and  that  (in  my  opinion)  by  the  earnestness  of  some 
gentlemen,  who  at  last  were  forced  quietly  to  give  up 
the  point.’ 1  The  Bill  was  read  for  the  third  time  on 
January  19,  and  sent  to  the  Lords,  and,  being  approved 
by  them,  received  the  Royal  Assent  on  January  25. 

The  matter  had  already  attracted  the  attention  of  the 
House  of  Lords,  where,  at  the  instance  of  the  Duke  of 
Wharton,  it  was  considered  on  December  20.  The  Duke 
made  a  tremendous  onslaught  on  the  mismanagement 
of  the  Company,  dwelt  with  emphasis  on  the  fraudulent 
practices  of  the  Directors  (as  instanced,  he  stated,  in 
some  collusive  bargains  about  stock  between  the  Sword - 
blade  Company  and  Robert  Knight,  the  South  Sea 
Treasurer),  and  expressed  the  hope  that  condign  punish¬ 
ment  would  be  meted  out  to  the  guilty  parties.  Lord 
North  and  Grey  was  no  whit  less  severe  in  his  condemna¬ 
tion,  but  was  able  to  derive  some  personal  satisfaction 

1  Middleton  Papers ,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole ,  II.,  205. 


o 


194 


THE  SOUTH  SEA  BUBBLE 


from  the  fact  that  eight  months  earlier  he  had  prophesied 
the  dismal  consequences  with  which  they  were  now 
confronted.  Papers  were  called  for,  and  these  were 
laid  before  the  House  on  January  9.  On  the  following 
day  Lord  Stanhope  moved,  ‘  That  the  estates  of  the 
criminals,  whether  Directors  or  not,  ought  to  be  con¬ 
fiscated  to  make  good  the  public  losses.5  In  support 
the  Duke  of  Wharton  insisted  that  in  apportioning  the 
blame  they  must  be  no  respecters  of  persons  whatever 
their  station,  and  Lord  Cowper  said  those  were  respon¬ 
sible  who  were  appointed  to  supervise  the  proceedings 
of  the  Directors.  Lord  Sunderland,  replying  for  the 
Government,  admitted  that  he  had  been  in  favour  of 
the  scheme,  which  he  thought  if  properly  carried  out 
would  have  been  for  the  public  good,  and  he  urged 
that  no  one  could  have  conceived  that  it  would  have 
been  so  abused  in  practice.  He  then  declared  that  the 
appointing  the  Directors  of  the  South  Sea  Company  to 
be  managers  for  executing  the  South  Sea  Act  was  legal, 
and  his  contention  was,  on  a  division,  supported  by  63 
to  28  votes. 

The  Lords  ordered  the  Directors  and  officers  of  the 
Company  to  attend  on  January  12,  when  they  were 
examined  ;  but  their  answers  were  unsatisfactory,  and 
the  House  passed  a  resolution,  4  That  the  Sub-Governor 
and  Directors  of  the  South  Sea  Company  had  prevari¬ 
cated  with  them,  in  giving  false  representations  of 
several  matters  of  fact ;  that  by  lending  money  on  stock 
and  subscriptions  they  were  guilty  of  a  notorious  breach 
of  trust ;  and  that  they  ought  to  make  good  the  losses 
the  Company  had  sustained  by  their  fraudulent  manage¬ 
ment.5  The  examination  continuing,  on  January  19  it 
transpired  that  large  quantities  of  stock  had  been  trans¬ 
ferred  to  Aislabie,  whereupon  the  Duke  of  Wharton 


James, 


First  Earl  of 


Stanhope 


p.  194 


PARLIAMENTARY  MEASURES 


195 


said,  4 1  hope  some  great  men  will  produce  some  good 
fruit,  else  they  will  break  out  into  blotches  that  will 
stick  upon  them,  like  the  leprosy  of  Naaman  the  Syrian 
on  Gehazi.’ 

When  the  Commons  assembled  on  January  23,  they 
received  the  unexpected  and  startling  news  that  Robert 
Knight,  Cashier  of  the  South  Sea  Company,  had  ab¬ 
sconded.  During  the  previous  week  his  examination  by 
the  Committee  of  Secrecy  had  begun,  and  without 
waiting  for  its  conclusion,  he  had,  without  warning,  on 
Sunday  night  embarked  for  Calais,  leaving  behind  him 
a  letter,  dated  the  previous  day,  and  addressed  to  his 
Directors,  which  was  brought  to  the  House  by  Robert 
Surman,  the  Deputy- Cashier.  4 1  write  this,’  so  ran 
this  document,  4  from  a  true  sense  of  the  obligation  I 
am  under  to  make  up  my  accounts  with  the  Company, 
and  to  pay  them  their  full  demand  ;  and  though  self- 
preservation  has  obliged  me  to  withdraw  myself  from 
the  resentment  against  the  Directors  and  myself,  yet  I 
am  not  conscious  to  myself  of  having  done  any  one  thing 
that  I  can  reproach  myself  for,  so  far  as  relates  to  an 
honest  sincere  intention  and  zeal  for  the  Company; 
but  I  can,  and  do,  charge  myself  with  a  great  many 
indiscretions,  and  am  (besides  the  concern  I  must  be 
under  for  leaving  my  own  family,  friends,  etc.)  very 
sensibly  touched  with  what  you  are  likely  to  suffer  on 
this  account ;  and  it  will  be  the  more,  I  am  afraid,  from 
your  want  of  unanimity,  which  I  heartily  recommend 
to  you  for  the  future,  and,  I  am  sure,  wish  you  as  well 
as  you  wish  yourselves.  I  write  this  at  a  distance  from 
home,  and  under  a  great  deal  of  concern,  so  cannot 
be  so  particular  as  otherwise  I  would  have  been.  I 
have  herewith  sent  Mr.  Surman  the  keys  of  my  desks, 
who  knows  so  much  of  the  state  of  the  cash  as  to  be 


196 


THE  SOUTH  SEA  BUBBLE 


able  to  make  it  up.  There  are  a  good  many  Bills  of 
Exchange  and  other  payments  to  write  off,  and  the 
weekly  receipts  to  write  on.  There  is  cash  in  the  Bank, 
in  the  Company’s  book,  which,  together  with  the  notes 
taken  on  the  Third  and  Fourth  Subscriptions,  and  the 
Company’s  bonds,  will  make  up  the  balance  as  I  do 
believe.  But  if  it  fall  short,  I  have  £3,000  equivalent 
stock,  £1,500  Bank  stock,  £2,000  India  and  South  Sea 
stock,  over  and  above  what  I  owe  the  Company  on  the 
loan,  as  will  be  sufficient  to  make  it  up  with  money 
owing  on  securities  on  my  particular  account.  The 
Company  need  not  deliver  or  be  answerable  for  the  Sub¬ 
scription  receipts  or  stock  on  the  Third  and  Fourth  Sub¬ 
scriptions,  unless  these  notes  are  paid  ;  so  the  loss  can 
only  be  the  difference  between  the  Subscriptions  and 
money  in  value.  And,  I  think,  it  would  be  hard  for  me 
to  bear  the  loss,  because  the  clerks  took  by  far  the  great¬ 
est  part  of  them,  as  thinking  them  better  than  none. 
And  most  of  them  would  have  been  non-payments,  if 
they  had  been  refused.  However,  I  submit  this  to 
the  Company.  I  have  taken  with  me  but  little  more 
than  a  sufficiency  to  maintain  myself ;  and  the  effects 
left  will  more  than  answer  for  all  the  deficiencies.  I 
have  bought  no  land  in  trust  for  me,  nor  have  I  ever 
conveyed  or  settled  any  part  of  that  I  had  formerly, 
or  have  bought  lately  ;  it  remains  to  answer  any  demands 
on  me  from  the  Company  or  the  Legislature.  I  have 
withdrawn  myself  only  to  avoid  the  weight  of  the 
enquiry,  which  I  found  too  heavy  for  me;  and  I  am 
sensible  that  it  would  have  been  impossible  for  me  to 
have  avoided  the  appearance  and  charge  of  prevarication 
and  perjury,  not  from  my  own  intention  to  do  so,  but 
from  the  largeness  and  extent  of  the  enquiry,  and  the 
nature  and  largeness  of  the  transactions.  I  am  sure 


PARLIAMENTARY  MEASURES 


197 


I  am  a  good  deal  concerned  to  add  to  your  present 
difficulties  ;  though  I  must  say  I  have  deserved  better 
usage  than  I  have  had  from  the  Court  the  last  week ; 
but  this  I  say  without  any  resentment,  otherwise  than 
that  it  has  been  an  addition  to  the  weight  I  had  before 
upon  me.’ 

Little  is  known  of  Knight,  save  what  may  be  deduced 
from  the  description  given  by  Arthur  Onslow,  who 
wrote  :  ‘  He  was  certainly  a  man  of  good  parts,  of  an 
address  far  above  his  birth  or  former  manner  of  life 
(which,  I  think,  had  been  that  of  a  tradesman),  very 
insinuating,  open  in  appearance,  yet  close  and  dexterous 
in  management  of  the  trusts  he  undertook.’  1  Though 
but  a  paid  servant,  he  was  regarded  as  one  of  the  most 
important  witnesses  in  the  case,  for,  from  the  position 
he  occupied,  he  had  perforce  been  entrusted  with  all 
the  secrets  of  the  project,  and  was  acquainted  in  the 
main,  if  not,  perhaps,  in  detail,  with  the  corrupt 
dealings  of  the  Company  with  the  guilty  Ministers. 
If  he  had  remained  in  this  country  he  faced  the  risk 
of  a  long  term  of  imprisonment  and  the  certainty  of 
losing  any  profits  he  might  have  made  by  specula¬ 
tion.  It  is  true  that  he  might  possibly  have  been 
able  to  drive  a  bargain  to  be  held  indemnified  if  he 
betrayed  his  superiors,  but  there  is  no  reason  to 
suppose  that  he  entertained  the  idea  of  any  such  base¬ 
ness.  It  is  most  probable,  indeed,  that  it  was  the  guilty 
parties  in  high  places  who,  in  the  hope  of  saving  them¬ 
selves,  urged  him  to  fly.  Rightly  or  wrongly,  this  was 
the  idea  generally  entertained.  4  You  will  by  this  post 
have  an  account  that  your  acquaintance,  Mr.  Knight, 

1  Anecdotes  of  Arthur  Onsloiv  (Hist.  MSS.  Com.,  XVI.,  App. 
Pt.  IX.,  507). 


198 


THE  SOUTH  SEA  BUBBLE 


is  gone  off ;  he  went  as  it  is  supposed  last  Saturday 
night  or  Sunday  morning,’  Lady  Elizabeth  Lechmere 
wrote  to  Lord  Carlisle  on  January  24.  4 1  have  not 

heard  what  resolutions  the  Commons  came  to  yesterday, 
but  ’twas  thought  upon  this,  all  the  Directors  would  be 
taken  into  custody.  I  believe  Mr.  Knight’s  being  gone 
will  be  a  loss  to  the  Secret  Committee,  for  he  knew  as 
much  of  the  secret  as  anybody.  ’Tis  said  that  some 
of  the  principal  brokers  will  make  discoveries  ;  to  be 
sure  ’tis  in  their  power,  who  have  transacted  so  much, 
to  give  a  good  deal  of  light.  I  believe  those  people  are 
not  very  easy  at  present,  who  know  themselves  to  be 
deep  in  the  knavish  part  which  was  last  summer  carried 
on  with  so  much  success.’  1  Dr.  William  Stratford, 
writing  to  Edward  Harley,  was  more  outspoken.  4  No 
doubt  Knight’s  going  was  by  concert,  and  it  is  likely 
with  others  besides  Directors,’  he  wrote  two  days  later. 

4 1  fancy  too,  as  you  do,  that  after  all  the  noise  these 
gentlemen  will  not  suffer  what  others  expect,  much  less 
what  they  deserve.’ 2 

The  House  of  Commons  must  have  regretted  that, 
on  January  4,  they  had  not  accepted  Lord  Hinchin- 
brook’s  motion,  that  the  Directors  and  Officers  of  the 
Company  be  ordered  into  custody.  They  now  did  the 
best  they  could  to  repair  their  blunder,  and  at  once 
sent  two  Addresses  to  the  King,  one  praying  him  4  to 
issue  a  proclamation  for  discovering,  apprehending, 
and  detaining  Robert  Knight,  that  he  may  be  brought 
to  justice  ’ ;  the  other,  4  to  give  orders  forthwith  to  stop 
the  ports,  and  to  take  effectual  care  of  the  coasts,  to 
prevent  the  said  Mr.  Knight  or  any  other  officers  of 
the  South  Sea  Company  from  escaping  out  of  the  King- 

1  Carlisle  MSS.,  28. 

2  Portland  MSS.,  VII.,  288. 


PARLIAMENTARY  MEASURES 


199 


dom.’  This  was  with  a  vengeance  locking  the  stable 
door  after  the  horse  had  been  stolen  ;  but  it  was  all  that 
remained  to  do.  On  their  own  account,  however,  they 
took  drastic  steps,  upon  a  preliminary  statement  of  the 
Committee  of  Secrecy.  1  That  they  had  already  dis¬ 
covered  a  train  of  the  deepest  villainy  and  fraud  that 
Hell  ever  contrived  to  ruin  a  nation,  which  in  due  time 
they  would  lay  before  the  House ;  and  that  in  the 
meanwhile,  in  order  to  a  further  discovery,  they  thought 
it  highly  necessary  to  secure  the  persons  of  some  of 
the  Directors  and  principal  South  Sea  Officers,  and  to 
seize  their  papers.’  Upon  this,  orders  were  given  to 
secure  the  books  of  Knight,  Surman,  John  Grigsby 
(Accountant  of  the  Company),  Elias  Turner,  and  Sir 
George  Caswell  &  Co.,  and  to  arrest  Sir  John  Blunt, 
Sir  John  Lambert,  Directors,  and  Sir  John  Fellowes 
the  Sub- Governor.  The  Commons  then  passed  a  motion 
that  the  four  Directors  who  were  members  of  the  House 
(Sir  Robert  Chaplin,  Sir  Theodore  Janssen,  Francis  Eyles, 
and  Jacob  Sawbridge)  4  were  guilty  of  a  notorious  breach 
of  trust  as  Directors  of  the  South  Sea  Company,  and 
thereby  occasioned  very  great  loss  to  great  numbers 
of  His  Majesty’s  subjects,  and  had  highly  prejudiced 
the  public  credit,’  and  proceeded  to  expel  them,  and  to 
give  them  into  the  custody  of  the  Serjeant-at-Arms. 

That  same  evening  Aislabie,  the  Chancellor  of  the 
Exchequer,  resigned,1  and,  by  an  Order  in  Council,  all 
South  Sea  Directors  were  deprived  of  their  places  and 
their  names  struck  off  the  Commissions  of  the  Peace. 

1  Sir  John  Pratt  (1657-1725),  Chief  Justice  of  the  Court  of 
King’s  Bench,  succeeded  Aislabie  as  Chancellor  of  the  Exchequer. 
He  was  sworn  in  on  February  4,  but  only  held  this  office  until 
April  3,  when  Walpole  became  First  Lord  of  the  Treasury  and 
Chancellor  of  the  Exchequer. 


200 


THE  SOUTH  SEA  BUBBLE 


Those  who  suffered  by  this  were :  James  Edmondson, 
purser  of  H.M.S.  Royal  Anne  ;  Francis  Hawes,  Cashier 
of  the  Customs  ;  Sir  Harcourt  Master,  Receiver- Gen¬ 
eral  of  the  City  of  London ;  Thomas  Reynolds,  a 
Commissioner  of  the  Victualling  Office  ;  Robert  Houl- 
ditch,  Treasurer  of  the  Stamp  Office ;  and  Arthur 
Ingram,  Treasurer  of  the  duties  upon  salt. 

By  Royal  Proclamation,  £2,000  was  offered  for  the 
taking  of  Knight,  but  even  this  great  reward  was  useless, 
for  the  offender  had  escaped  from  France  to  the  Nether¬ 
lands.  There,  indeed,  his  whereabouts  becoming  known, 
the  English  Minister  applied  to  the  Marquis  de  Prie,  and 
at  his  instance  Knight  was  seized,  and  imprisoned  in 
the  castle  at  Antwerp.  The  States  of  Brabant,  however, 
pleaded  their  privileges  by  which,  under  a  charter 
granted  by  the  Emperor  Charles  V.,  which  had  been 
ratified  by  his  successors,  no  person  charged  with,  or 
apprehended  for,  any  crime  could  be  removed  to  be 
tried  outside  their  province.  4  Yesterday,’  Edward 
Harley,  junior,  wrote  to  Abigail  Harley,  on  March  28, 
4  the  Commons  received  an  answer  from  the  King,  relating 
to  Mr.  Knight ;  the  King’s  letter  to  the  Emperor,  the 
Emperor’s  answer,  Townshend’s  letter  to  Zinzendorf, 
and  his  answer,  were  all  read  to  them  ;  and  they  all 
give  but  little  encouragement  to  expect  Knight.  The 
Emperor  says  he  must  protect  the  State  and  Liberties  of 
Brabant,  but  will  endeavour  to  prevail  on  them  to  give 
him  up.  Yea,  quoth  the  Emperor,  but  not  to-day. 
Upon  this  Hutchenson  moved  that  Knight  should  be 
pardoned,  was  seconded  by  the  Attorney-General,  who 
added,  and  to  have  his  estate,  but  Jekyll  sounded  a 
retreat  and  another  day  is  appointed  to  consider  Knight’s 
affairs.  A  large  trunk  of  his  papers  was  sent  down  from 
the  Lords,  which  are  ordered  to  be  perused  by  a  Com- 


PARLIAMENTARY  MEASURES 


201 


mittee  (not  the  Secret).’ 1  Much  as  they  wanted  his 
evidence,  the  House  did  not  feel  it  could  purchase  it  at 
the  price  of  complete  indemnity.  Further  particulars 
of  the  case  are  forthcoming  in  a  letter,  written  in  May, 
to  the  Hon.  John  Molesworth  :  4  On  mande  par  une 
lettre  secrette  datSe  le  premier  de  ce  mois  de  Mai  de 
Bruxelles,  qu’il  ni  avoit  point  a  douter  ou  que  le  Sr 
Knight,  dernier  cassier  de  la  Compagnie  du  Sud  d’Angle- 
terre  y  avoit  StS  menS  en  secret  d’Anvers,  que  depuis 
ce  temps  les  etats  de  Brabant,  s’Stant  assemblies,  on 
disoit  qu’ils  ne  pourroient  consentir  a  ce  qu’il  fut 
transports,  et  que  la  chose  avoit  StS  remise  a  une  autre 
assemblee  ;  le  fils  du  dit  Knight  Stoit  a  present  enferme 
avec  son  pSre  sur  ce  que  Monsieur  le  Resident  Leathes 
a  represente  qu’il  faisoit  des  brigues,  et  qu’en  effet  la 
requete  qui  a  ete  presentee  en  son  nom  etoit  tres  forte 
et  contenoit  une  enumeration  des  Articles  des  plusiers 
Inaugurations,  qui  portent  qu’aucun  Stranger,  refugiS 
aux  Pais  Bas,  et  coupable  de  quelque  crime  que  ce  soit, 
ne  pourra  Stre  transports  ailleurs  pour  etre  jugS,  mais 
qu’on  luy  feroit  son  proces  a  Bruxelles  ;  que  cependant 
il  paroisoit  que  c’est  serieusement  et  tout  de  bon,  que 
la  Cour  d’Angleterre  presse  pour  qu’il  soit  livrS,  que  la 
lettre  de  Sa  MajestS  Brittanique  a  l’Empereur  est  si 
forte,  et  si  pressante,  qu’on  n’en  peut  douter  la  conduite 
de  Knight,  chargS  de  la  caisse  publique,  y  est  traittS  de 
crime  atroce,  et  l’on  y  fait  considerer  la  ruine  non  seule- 
ment  d’une  infinitS  de  families,  mais  aussi  la  perte  du 
credit  publiq,  qu’ainsi  il  paroissoit  par  toutes  les 
demarches  du  Resident  Anglois,  que  c’est  absoluement 
qu’on  veult  qu’il  soit  livrS,  qu’a  ce  qu’on  disoit,  il 
s’agissoit  d’une  solde  de  comte  de  £800,000  sterling, 
dont  le  dit  Knight  pouvoit  seul  enseigner  l’employ 

1  Portland  MSS.,  V.,  619. 


202 


THE  SOUTH  SEA  BUBBLE 


en  fait,  qui  est  uniquement  se  qu’on  luy  demande. 
Cette  lettre  adjoute  qu’il  avoit  lieu  d’esperer  pourtant 
qu’il  pourra  etre  livre  a  certaines  conditions,  et  qu’on 
n’a  que  faire  convoquer  de  nouveau  encore  une  fois  les 
Etats  de  Brabant  que  le  moins  le  President  donnoit 
cette  esperance  ;  mais  que  l’on  s’etonne  que  le  Ministre 
d’Angleterre  n’est  pas  sollicitd  de  PEmpereur  meme 
des  lettres  addressies  aux  des  Etats  de  Brabant ;  on 
croriot  que  cel  pourroit  reussir,  et  qu’ils  le  livroient  a 
conditions  et  sans  prejudices  de  leurs  privileges  pour 
cette  fois  la  seulement,  en  regard  a  Pimportance  de  la 
chose,  et  aux  consequences  si  prejudiciables  a  un  bon 
Allie  de  PEmpereur.’1 

Presently  Knight  made  his  escape  from  Antwerp, 
and,  according  to  Arthur  Onslow  (who  declared  he  had 
the  information  from  ‘undoubted  authority ’),  the  escape 
was  made  with  the  connivance  of  the  Marquis  de  Prie, 
who  for  this  service  and  for  not  delivering  him  up,  re¬ 
ceived  from  the  King’s  Civil  List,  through  the  medium 
of  Lord  Sunderland,  the  sum  of  £50,000.  Anyhow, 
Knight  was  not  surrendered.  In  later  years  he  settled 
in  Paris,  where,  again  according  to  Onslow,  he  lived  in 
great  style,  4  treating  and  caressing  and  doing  all  kind 
offices  to  the  English  who  went  there,  in  the  hope  that 
sooner  or  later  they  might  contrive  his  return  to  his 
own  country.  In  August,  1742,  he  was  granted  a  pardon 
under  the  Great  Seal. 

It  was  generally  believed  that  the  efforts  to  secure  the 
return  of  Knight  in  1721  were  more  apparent  than  real, 
and  that  neither  the  Court  nor  the  Ministrv  wished  him 
to  appear  upon  the  scene.  So  generally  was  the  point 
of  view  accepted  that  his  absence  was  regarded  by  those 
in  high  places  as  desirable  in  the  interests  of  others  also 

1  Clements  MSS.,  314.  This  letter  is  printed  as  written. 


PARLIAMENTARY  MEASURES 


203 


in  high  places,  that  the  cartoonists  delighted  to  place 

the  supposed  culprits,  Aislabie,  Craggs,  the  Duchess  of 

Kendal,  the  Countess  of  Platen,  and  others  behind  a 

screen,  which  sheltered  them  from  the  full  publicity 

of  their  misdoings.  One  of  these  cartoons,1 * *  styled 

4  The  Brabant  Screen,’  and  dated  July  29,  1721,  had 

printed  below  it  these  lines  : — 

In  vain,  Great  Britain  sues  for  Knight’s  discharge, 

In  vain  we  hope  to  see  that  wretch  at  large  ! 

If  traitors  here,  the  villain  there  secure, 

Our  ills  must  all  increase,  our  woes  be  sure. 

Should  he  return,  the  screen  would  useless  be, 

And  all  men  then  the  mystery  would  see  : 

The  mask  thrown  off,  the  villain  would  appear 
Not  Antwerp’s  slave,  but  others  that  are  here. 

Almighty  God,  exert  Thy  awful  power, 

Oh  !  let  not  sycophants  our  land  devour  : 

Too  sure  again  !  we  may  be  all  betray’d, 

If  to  do  justice  now  we  are  afraid  ! 

Our  noble  senate,  honest,  just,  and  brave, 

Fain  would  this  realm  from  dire  destruction  save  ; 

They  all  unite,  our  glory  to  inflame, 

And  would  confirm  us  great,  as  is  our  name  ! 

Too  well  they  see  those  snakes,  who  perdou  lie, 

Screened  by  betrayers  of  our  liberty, 

Who  bask  themselves  in  our  security. 

Under  this  covert  they  would  seem  our  friends, 

But  oh  !  their  treach’rous  aims  have  fatal  ends. 

Assist,  Great  George,  the  runs  of  empire’s  thine, 

Guide  thou  thy  chariot,  like  a  God  divine  1 
Let  no  curs’d  traitor  tho’  of  high  degree 
Eclipse  the  beams  of  sacred  Majesty  1 
Give  ear  to  pray’rs  which  thy  best  subjects  make, 

And,  oh  !  defend  this  land  for  pity’s  sake. 

Each  member  of  the  state,  distinctly  brave, 

Does,  by  addressing,  thy  protection  crave  ; 

Throughout  the  realm,  our  loud  complaints  are  sent, 

Oh,  King  and  Father  !  all  our  griefs  prevent ! 

1  There  are  several  cartoons  dealing  with  Knight.  One  of 

the  best  is,  4  Robin’s  Flight,  or,  The  Ghost  of  the  late  S.S. 

Treasurer  ferry’d  into  Hell.’ 


CHAPTER  IX 


The  Committee  of  Secrecy 

FEBRUARY,  1721 

HE  flight  of  Robert  Knight  did  not  have  so  great 


JL  an  effect  as  those  who  engineered  it  must  have 
hoped,  but  the  absence  of  this  witness,  together  with 
the  disappearance  of  some  of  his  books,  did  certainly 
hamper  the  investigation.  Happily,  however,  there  still 


remained  others  from  whom,  by  skilful  and  persistent 


examination,  was  gleaned  sufficient  information  to  damn 


those  most  intimately  associated  with  the  project. 


The  Lords,  apparently  unperturbed  by  the  flight  of 
the  Treasurer  of  the  Company,  proceeded  with  their  in¬ 
vestigations,  and  on  January  24,  in  consequence  of  the 
admission  of  Charles  Joye,  the  Sub-Governor,  they,  on 
a  motion  of  Lord  Stanhope,  ordered  into  the  custody  of 
Black  Rod,  five  Directors,  Sir  William  Chapman,  Robert 
Chester,  Edward  Gibbon,  Francis  Hawes,  and  Robert 
Houlditch.  Transactions,  each  more  discreditable  than 
the  last,  came  to  light  one  after  the  other,  and  two  days 
later  the  House  was  shocked  to  find,  fully  confirmed  by 
the  evidence  given  by  Sir  Harcourt  Master  and  William 
Astell,  the  rumour,  which  for  some  time  had  been  current, 
that  not  only  had  several  members  of  the  Lower  Chamber 
received  gifts  of  South  Sea  stock  for  voting  for  the  Bill, 
but  that  members  of  the  Government  had  by  the  same 

204 


COMMITTEE  OF  SECRECY 


205 


means  been  induced  to  give  it  their  support.  On  this, 
it  was  resolved  by  a  motion,  moved  by  Lord  Stanhope, 
seconded  by  Lord  Townshend,  and  carried  unanimously, 
4  That  the  taking  in  of  stock,  the  transferring  of  stock 
to  the  South  Sea  Company,  the  giving  credit  for  the 
same  without  a  valuable  consideration  actually  paid 
or  sufficiently  secured,  or  the  purchasing  stock  of  any 
Director  or  agent  of  the  South  Sea  Company  for  the 
use  or  benefit  of  any  person  in  the  Administration,  or 
any  member  of  either  House  of  Parliament,  during  such 
time  as  the  late  Bill  relating  to  the  South  Sea  Company 
was  depending  last  year  in  Parliament,  was  a  notorious 
and  dangerous  corruption.’  Five  days  later,  in  conse¬ 
quence  of  further  revelations,  the  Lords  put  it  on  record, 
4  That  the  Directors  of  the  South  Sea  Company,  having 
ordered  great  quantities  of  stock  to  be  bought  for  the 
service  of  the  Company,  when  stock  was  at  very  high 
prices,  under  pretence  of  keeping  up  the  price  of  stock ; 
and  at  the  same  time  several  of  the  Directors  and  other 
officers  belonging  to  the  Company  having,  in  a  clandes¬ 
tine  manner,  sold  their  own  stock  to  the  Company ;  such 
Directors  and  officers  were  thereby  guilty  of  a  notorious 
fraud  and  breach  of  trust ;  and  their  so  doing  was  one 
great  cause  of  the  unhappy  turn  of  affairs  that  has 
so  much  affected  the  public  credit.’  Little  by  little, 
the  whole  story  was  extracted  from  the  witnesses,  and 
after  the  examination  of  Hawes  and  some  of  the  brokers, 
the  House  of  Lords,  on  February  2,  came  to  the  fol¬ 
lowing  conclusions  :  (i)  That  the  Directors,  etc.,  buying 
the  Midsummer  dividend  about  the  4th  of  January,  1720, 
and  paying  Five  Shillings  down,  and  £3  after  the  receipt 
of  the  said  dividend,  was  a  fraud  to  the  persons  with 
whom  they  contracted  ;  (ii)  that  the  giving  a  premium 
for  the  refusal  of  stock  at  higher  prices  than  they  knew 


206 


THE  SOUTH  SEA  BUBBLE 


the  value  was,  was  a  fraudulent  artifice  to  raise  the  price 
of  stock ;  (iii)  that  promoting  the  third  subscription 
at  £l,000  per  cent,  was  to  answer  a  particular  end  and 
to  cheat  the  public ;  (iv)  that  the  declaring  thirty 
per  cent,  dividend  for  a  half-year,  and  fifty  per  cent, 
per  annum  for  no  less  than  twelve  years  after,  was  a  vil¬ 
lainous  artifice  to  delude  and  defraud  His  Majesty’s 
good  subjects  ;  and  (v)  that  the  declaring  the  Midsum¬ 
mer  dividend  to  be  paid  in  stock,  when  they  had  money 
by  them  to  answer  the  same,  was  a  notorious  fraud,  and 
was  one  occasion  of  the  misfortune  that  ensued. 

One  of  the  most  important  witnesses  was  Sir  John 
Blunt.  Originally  a  scrivener,  he  had,  by  sheer  force 
of  great  business  ability,  acquired  a  fortune,  and  had 
been  one  of  the  chief  projectors  of  the  scheme.  He  was, 
it  has  been  stated,  a  Dissenter  of  a  most  religious  deport¬ 
ment,  and  he  was  never  weary  of  declaiming  against  the 
corruption  and  luxury  of  the  age  :  wherefore  Pope  por¬ 
trayed  him  in  his  4  Epistle  to  Allen,  Lord  Bathurst  ’  : — 


4  Much  injured  Blunt !  why  bears  he  Britain’s  hate  ? 

A  wizard  told  him  in  these  words  our  fate  : 

“  At  length  corruption,  like  a  general  flood, 

(So  long  by  watchful  ministers  withstood) 

Shall  deluge  all  ;  and  avarice  creeping  on, 

Spread  like  a  low-born  mist,  and  blot  the  sun  ; 
Statesman  and  patriot  ply  alike  the  stocks, 

Peeress  and  butler  share  alike  the  box, 

And  judges  job,  and  bishops  bite  the  town, 

And  mighty  bishops  pack  cards  for  half-a-crown. 

See  Britain  sunk  in  lucre’s  sordid  charms, 

And  France  revenged  on  Anne’s  and  Edward’s  arms  !  ” 
’Twas  no  court-badge,  great  scriv’ner  !  fired  thy  brain, 
Nor  lordly  luxury,  nor  city  gain  ; 

No,  ’twas  the  righteous  end,  asham’d  to  see 
Senates  degenerate,  patriots  disagree, 

And,  nobly  wishing  party-rage  to  cease, 

To  buy  both  sides,  and  give  thy  country  peace.’ 


COMMITTEE  OF  SECRECY 


207 


On  the  day,  February  4,  when  Sir  John  Blunt  was 
examined  before  the  Lords,  the  Duke  of  Wharton,  d 
propos  of  the  South  Sea  scheme,  made  an  attack  on  the 
general  conduct  of  the  Government,  and  concluded 
with  a  tremendous  onslaught  on  Lord  Stanhope,  whom 
he  accused  of  having  created,  or  at  least  fomented,  the 
dissensions  between  the  King  and  the  Prince  of  Wales. 
4  My  Lords,’  he  said,  4  there  was  in  the  reign  of  Tiberius 
a  favourite  minister,  by  name  Sejanus  ;  the  first  step 
he  took  was  to  wean  the  Emperor’s  affection  from  his 
son  ;  the  next,  to  carry  the  Emperor  abroad  ;  and  so 
Rome  was  ruined.’  Lord  Stanhope  retorted  very  hap¬ 
pily  upon  his  assailant.  4  The  Romans  were  certainly 
a  great  people,  and  furnished  many  illustrious  examples 
in  their  history,  which  ought  to  be  carefully  read,  and 
which  I  make  no  doubt  the  noble  peer  who  spoke  last 
has  done,’  he  replied.  4  The  Romans  were  likewise 
universally  allowed  to  be  a  wise  people ;  and  they 
showed  themselves  to  be  so  in  nothing  more  than  by 
debarring  young  noblemen  from  speaking  in  the  Senate 
till  they  understood  good  manners  and  propriety  of 
language.  As  the  Duke  has  quoted  an  instance  from 
the  history  of  a  bad  minister,  I  beg  leave  to  quote  from 
the  same  history  an  example  of  a  great  man,  a  patriot 
of  his  country,  who  had  a  son  so  profligate  that  he  would 
have  betrayed  the  liberties  of  it,  on  which  account  his 
father  himself  [the  elder  Brutus]  had  him  whipped  to 
death.’  So  angry  was  Lord  Stanhope,  and  so  heated 
did  he  become  while  making  this  bitter  reply,  that,  in 
his  passion,  he  broke  a  blood-vessel,  from  the  effects  of 
which  accident  he  died  on  the  following  day. 

In  justice  to  the  Duke  of  Wharton,  it  must  be  said 
that  subsequently  he  made  ample  amends  for  his  speech 
in  the  House  of  Lords  by  contributing  to  his  paper,  the 


208 


THE  SOUTH  SEA  BUBBLE 


True  Briton ,  a  handsome  panegyric  on  the  deceased 
statesman.  4  The  Earl  of  Stanhope,’  he  wrote, 4  who  had 
passed  through  the  greatest  employments,  is  another 
example  of  this  glorious  disinterestedness  ;  and  by  the 
opinion  which  the  world  had  framed  of  his  uncorrupt 
views,  he  was  not  only  grown  popular  at  home,  but  was 
personally  esteemed  by  all  the  princes  abroad  ;  and  it 
is  a  memorable  saying  of  the  late  King  of  Spain’s  of  the 
Earl  of  Stanhope,  44  That  he  would  rather  have  him  for 
his  minister  than  be  master  of  the  kingdom  of  England.” 
When  the  circumstances  of  affairs  at  home,  too  fresh 
in  every  man’s  memory  to  be  repeated,  induced  his 
Majesty  to  place  him  at  the  head  of  the  Treasury,  though 
he  served  in  that  capacity  for  some  time,  yet  he  left  a 
small  patrimony  to  his  family,  scarce  sufficient  to  sup¬ 
port  the  dignity  of  the  peerage.  But  he  has  left  his 
son  the  glory  of  knowing  that  he  is  descended  from  a 
father  who  was  never  accused  of  bribery  and  corruption 
by  any  resolution  of  Parliament ;  and  upon  whose 
memory  the  most  inveterate  of  his  enemies,  even  those 
who  with  the  greatest  malignity  opposed  his  Majesty’s 
measures  when  he  was  in  power,  would  not  have  been 
able  to  cast  the  least  reflection.’ 1 

In  the  meantime  the  Engrafting  Bill,  as  it  was  called, 
or  to  give  it  the  official  style,  4  A  Bill  to  enable  the 
South  Sea  Company  to  engraft  part  of  their  capital 
stock  and  fund  into  the  stock  and  fund  of  the  Bank  of 
England,  and  another  part  thereof  into  the  stock  and 
fund  of  the  East  India  Company ;  and  for  giving  fur¬ 
ther  time  for  payment  to  be  made  by  the  said  South  Sea 
Company  for  the  use  of  the  public,’  had  been  read  a 
first  time  on  February  2,  and  a  second  time  five  days  later. 
On  February  13,  a  petition  from  the  South  Sea  Company 
1  True  Briton ,  February  17,  1724. 


COMMITTEE  OF  SECRECY 


209 


was  presented  to  the  House,  praying  for  relief  in  relation 
to  the  payments  to  the  nation.  Shippen  moved  its 
rejection,  but  Walpole,  proposing  that  it  be  laid  on 
the  table,  had  his  way  by  253  to  166  votes.  Two  days 
later,  Paul  Methuen  1  brought  a  Royal  Message  to  the 
Commons  :  4  His  Majesty,  having  received  a  petition 
from  the  Court  of  the  South  Sea  Company  relating  to 
the  payment  of  the  money  due  to  the  public  from  the 
said  Company,  has  thought  it  fit  to  transmit  the  said 
Petition  to  the  House  of  Commons  ;  and  at  the  same 
time  to  acquaint  them  that  His  Majesty  has  no  objection 
to  the  Parliament’s  giving  to  the  South  Sea  such  ease 
and  relief  in  the  time  of  making  the  payments  due  to 
the  public  as  the  House  of  Commons  shall  think  fit  and 
reasonable.’  The  House,  after  taking  the  Message  into 
consideration,  resolved :  (i)  that  payment  of  the  sum 
of  £4,156,306  4s.  11  d.  due  to  the  public,  by  virtue  of  the 
Act  of  the  last  session  of  Parliament,  and  made  payable 
within  one  year,  by  four  quarterly  payments,  commenc¬ 
ing  March  25,  1721,  be  further  postponed  to  the  year 
1722  ;  and  that  further  provision  be  made  for  the  more 
effectual  payment  thereof ;  and  (ii)  that  the  repayment 
of  the  sum  of  £1,000,000  which  was  lent  to  the  South  Sea 
Company  on  June  7, 1720,  be  postponed  to  June  7, 1722. 
Clauses  embodying  these  resolutions  were  inserted  in 
the  Bill,  which  was  sent  to  the  Lords  on  March  2, 
and  received  the  Royal  Assent  on  March  23.2 *  It  may 
here  be  mentioned  that  the  Act,  which  was  only  permis¬ 
sive,  was  never  put  into  execution,  in  consequence  of 
other  arrangements  subsequently  made. 

1  Paul  Methuen  (1672-1757),  Comptroller  of  the  Household, 
1720-1725  ;  K.B.,  1725  ;  Treasurer  of  the  Household,  1725- 
1730. 

2  7  George  I.  c.  5. 

p 


210 


THE  SOUTH  SEA  BUBBLE 


The  Committee  of  Secrecy,  appointed  by  the  House 
of  Commons  to  enquire  into  the  transactions  of  the 
South  Sea  Company,  sat  regularly,  and  called  before 
them  all  who  could  possibly  be  supposed  able  to  assist 
in  unravelling  the  tangled  skein.  The  task  was  long 
and  arduous,  but  by  unremitting  attention,  Thomas 
Brodrick,  the  Chairman,  was  able  on  February  16  to  place 
before  the  House  the  first  Report.1  The  Committee 
had,  indeed,  done  its  work  well  and  thoroughly.  The 
Report,  which  was  read  by  Brodrick,  and  the  perusal  of 
which  took  two  and  a  half  hours,  was  a  document  of 
which  the  like  has  never  before  or  since  been  presented 
to  a  British  Parliament.  Members,  who  had  been  pre¬ 
pared  for  the  revelation  of  much  ill- doing,  were  almost 
overwhelmed  at  the  iniquity  disclosed.  It  was  far  worse 
than  any  one,  except  the  culprits,  had  expected.  4  It 
discloses,’  Edward  Harley  wrote  to  Lord  Oxford,  4  the 
greatest  scene  of  corruption  and  villainy  that  ever  was 
plotted  in  any  civilised  nation,  wherein  many  members 
of  both  Houses  are  concerned,  the  principal  Ministers 
of  State  named,  and  several  ladies  at  Court,  who  have 
had  large  shares  in  this  inquiry.  Mr.  Aislabie,  Mr. 
Craggs,  Mr.  Charles  Stanhope  2 *  in  trust  for  others,  ap¬ 
peared  to  be  the  principal  actors,  to  whom  the  Directors, 
Mr.  Knight,  and  the  Sword-blade  Company  have  been 
obsequious  managers  in  their  respective  stations.  .  .  . 
If  the  House  pursue  the  game  before  them  with  any 

1  There  were  seven  Reports  in  all.  The  others  were  pre¬ 
sented  on  February  25,  April  21,  May  22,  May  26,  June  5,  and 
June  16. 

2  Charles  Stanhope  (1673-1760),  third  son  of  John  Stanhope 
of  Elvaston,  Derbyshire,  and  elder  brother  of  William,  after¬ 

wards  first  Earl  of  Harrington  ;  M.P.  for  Milbourne  Port ; 

Under- Secretary  of  State,  1714-1717  ;  Secretary  to  the  Trea¬ 
sury,  1720-1721  ;  Treasurer  of  the  Chamber,  1721. 


COMMITTEE  OF  SECRECY 


211 


steadiness,  the  Lem  Knight1  is  likely  to  be  pickled  in 
South  Sea  brine.  His  name  is  often  mentioned  in  the 
Report,  as  a  great  negociator  in  these  affairs.’ 2  4  Never 

was  such  a  set  of  felons  ever  got  together,’  Lord  Harley 
wrote,  also  to  Lord  Oxford ;  adding,  4  The  new 
Directors  are  going  to  play  the  same  game  if  they 
can.’ 3 

The  Committee  prefaced  the  Report  with  the  state¬ 
ment  that  their  investigations  had  been  hampered  by 
many  difficulties,  and  that  every  conceivable  obstacle 
had  been  placed  in  the  way  of  their  arriving  at  the  truth. 
Most  of  the  witnesses  had  been  reluctant,  many  were 
afraid  to  speak  for  fear  of  incriminating  themselves  or 
their  fellows,  and  others  were  deterred  by  threats 4 ; 

1  Sir  George  Caswell,  M.P.  for  Leominster. 

2  February  16  ;  Portland  MSS.,  V.,  614. 

3  February  18  ;  Ibid.,  V.,  618. 

On  January  31  it  had  been  announced  that  the  King  remained 
Governor  of  the  South  Sea  Company,  and  that  Sir  John  Eyles 
and  John  Rudge  had  been  appointed  respectively  Sub- Governor 
and  Deputy-Governor.  On  February  2,  a  clean  sweep  was 
made  of  the  old  Directors,  and  the  following  elected  in  their 
place  :  Thomas  Ayles,  Sir  Thomas  Cross,  Samuel  Clarke, 
William  Brook,  Thomas  Frederick,  Thomas  Gearing,  Christopher 
Hayne,  Edward  Halsey,  Edmund  Keene,  Richard  Hopkins, 
Roger  Hudson,  Captain  Samuel  Jones,  John  Lade,  Matthew 
Lane,  Henry  Lovell,  Benjamin  Lethuilier,  John  Lloyd,  Nathaniel 
Mickleth waite,  James  Metcalfe,  Robert  Mitchell,  John  Nicoll, 
Captain  James  Osborne,  Thomas  Pearce,  Samuel  Pitt,  jr., 
Matthew  Raper,  Charles  le  Bas,  Richard  Thompson,  J.  Gerardot 
de  Tillieux,  Thomas  Willis,  Robert  Wood.  De  Cotz,  one  of 
the  Cashiers  of  the  Bank,  succeeded  Robert  Knight. 

4  After  the  reading  of  the  Fifth  Report  the  House  of  Commons 
first  resolved,  ‘  That  Mr.  Christopher  Clayton,  a  clerk  in  the 
Treasury-office  of  the  South  Sea  Company,  by  endeavouring 
to  prevail  with  Mr.  Samuel  Watts,  another  clerk  in  the  said 
office,  by  threats  and  menaces,  to  suppress  the  evidence  which 
he  was  able  to  give  to  the  Committee  of  Secrecy,  was  guilty  of 


212 


THE  SOUTH  SEA  BUBBLE 


many  books  had  been  destroyed  or  secreted,  while  of 
those  produced  many  had  fictitious  entries  or  had  pages 
missing  here  and  there.  None  the  less,  much  of  the 
first  importance  had  been  discovered.  ‘  The  first  matter 
that  offered  itself  to  the  consideration  of  your  Committee,’ 
so  ran  an  early  passage  in  the  Report,  ‘  was  a  scene 
of  iniquity  and  corruption,  the  discovery  of  which 
your  Committee  conceived  to  be  of  the  highest  import¬ 
ance  to  the  honour  of  Parliament  and  the  security 
of  His  Majesty’s  Government.’  It  appeared  that  many 
Directors  had  taken  in  stock  without  paying  for  it, 
and,  selling  at  an  enhanced  price,  had  pocketed  the 
difference.  This  was  bad,  and  a  matter  to  be  severely 
dealt  with,  but  worse  remained  to  tell.  It  was  shown 
that  when  the  Bill  was  before  Parliament,  the  Directors, 
at  a  time  when  they  had  no  more  than  £25,000  stock 
reserved  for  taking  in  the  annuities,  had  disposed  of  a 
fictitious  stock  of  £574,000,  which,  noted  as  sold  at 
various  prices  between  £175  and  £325  per  cent.,  amounted 
in  all  to  £1,259,325.  This  stock  was  intended  to 
assist  in  securing  support  for  the  Bill,  and  its  distribu¬ 
tion  was  entrusted  to  those  Directors  who  were  in  charge 
of  it,  Fell  owes,  Joye,  Blunt,  Gibbon  and  Chester.  It 
was  impossible,  owing  to  the  books  having  been  4  cooked,’ 
to  trace  the  whole  of  this  stock,  but  there  was  indis¬ 
putable  evidence  that  certain  persons  had  been  recipi¬ 
ents,  although  they  had  entered  into  no  mutual  agree¬ 
ment  or  acceptance  of  the  stock,  although  no  money 
had  been  deposited,  or  any  security  for  payment,  and 
consequently  could  not  lose  if  the  stock  fell,  and  would 
gain  if  it  rose  : — 

a  high  crime  and  misdemeanour,’  and  then  ordered,  4  That  the 
said  Mr.  Christopher  Clayton  be,  for  his  said  offence,  committed 
prisoner  to  His  Majesty’s  prison  of  the  Gate-House.’ 


COMMITTEE  OF  SECRECY 


213 


Charles,  Earl  of  Sunderland,  First  Lord' 

of  the  Treasury,  at  the  request  of  £50,000  (at  £170- 
James  Craggs  the  elder  J  £180  per 

cent.) 

Duchess  of  Kendal . £10,000)  (at  £150 

Her  two  nieces,1  each,  £5,000  ....  £10,000)  per  cent.) 

Countess  of  Platen  2 * . £10,000 

James  Craggs  the  elder . £30,000 

Charles  Stanhope . £10,000  (at  £250 

per  cent.) 

The  Sword-blade  Company  ....  £50,000 

It  was  further  evident  from  the  books  of  Sir  George 
Caswell  and  Co.  that  Charles  Stanhope — although  his 
name  had  been  erased  and  that  of  4  Stangape  5  written 
over  the  original  entry — had  received  in  differences  the 
enormous  sum  of  £250,000.  Far  worse,  because  of  the 
high  position  he  held,  was  the  case  of  Aislabie.  His 
account  amounted  to  no  less  than  £794,451.  Against 
him  it  was  further  proved  that  he  had  advised  the 
Company  to  make,  by  their  own  authority  and  without 
any  warrant,  the  second  subscription  £1,500,000  instead 
of  £1,000,000  as  sanctioned  by  Parliament.  The  third 
subscription  showed  the  following  lists :  Aislabie, 
£70,000  ;  Sunderland,  £160,000  ;  James  Craggs  the 
elder,  £659,000 ;  and  Charles  Stanhope,  £47,000.  In 
addition,  the  pawned  stock,  on  which  advances  had  been 

1  The  Duchess  of  Kendal’s  two  ‘  nieces  ’  were  presumedly 
her  two  daughters  by  George  I.  The  elder,  Petronella  Melusina 
(b.  1693),  created  in  1722  Countess  of  Walsingham,  who 
married  Philip  Stanhope,  fourth  Earl  of  Chesterfield  ;  and 
Margaret  Gertrude  (1703-1773),  who  married  the  Count  von 
Lippe. 

2  Countess  von  Platen  (nee  Kielmansegg)  was  created  in 

1721  Countess  of  Leinster  in  the  Irish  peerage,  and  in  1722 

Countess  of  Darlington  in  the  English  peerage.  The  statement, 

once  current,  that  the  lady  was  the  mistress  of  George  I.  has 
been  contradicted  :  she  was  his  half-sister. 


214 


THE  SOUTH  SEA  BUBBLE 


made  by  Knight  as  Cashier  of  the  Company,  when  sold, 
showed  a  deficiency  of  £400, 000. 1 

After  a  careful  consideration  of  the  Report,  the 
House  passed  the  following  Resolutions,  nem.  con. : — 

‘  1.  That  the  late  Sub-Governor,  Deputy- Governor, 
and  Directors  of  the  South  Sea  Company,  and  their 
officers,  and  their  aiders  and  abettors,  in  lending  out 
the  Company’s  money  upon  stock  and  subscription, 
without  taking  sufficient  security  for  repayment  thereof, 
have  been  guilty  of  a  notorious  breach  of  trust,  and 
have  thereby  occasioned  great  loss  to  the  Company,  for 
which  they  ought  to  make  satisfaction  out  of  their  own 
estates. 

1  2.  That  the  selling  or  disposing  of  stock  or  subscrip¬ 
tions  transferred  or  deposited,  as  a  security  for  the  repay¬ 
ment  of  money  so  lent,  was  a  notorious  breach  of  the 
trust  reposed  in  the  said  Sub-Governor,  Deputy- Governor, 
Directors,  and  their  officers,  and  a  fraud  on  the  pro¬ 
prietors,  in  order  to  enrich  themselves,  for  which  they 
ought  to  make  satisfaction  out  of  their  own  estates. 

‘  3.  That  the  taking  in  or  holding  of  stock  by  the 
South  Sea  Company  for  the  benefit  of  any  member  of 
either  House  of  Parliament  or  person  concerned  in  the 
Administration  (during  the  time  that  the  Company’s 
proposals,  or  the  Bill  thereto  relating,  were  depending  on 
Parliament)  without  any  valuable  consideration  paid, 

1  ‘  The  Directors  of  the  Company  do  own  in  conversation, 
that  their  Treasurer  had  no  orders  to  lend  upon  stock  above 
£400  per  cent.,  but  he  has  lent  £700  and  upwards  to  several, 
and  very  great  sums  upon  subscriptions,  and  that  must  become 
a  dead  loss  ;  for  there  is  no  more  to  be  paid  in  on  the  sub¬ 
scriptions,  as  I  am  told  ;  and  what  is  paid  in  already  is  to  be 
converted  into  stock.’ — Drummond  to  Daniel  Pulteney, 
November  24, 1720  (Pulteney  Papers,  quoted  in  Coxe’s  Memoirs 
of  Sir  Robert  Walpole,  II.,  195). 


COMMITTEE  OF  SECRECY 


215 


or  sufficient  security  given  for  the  acceptance  of,  or 
payment  for,  such  stock  ;  and  the  Company’s  paying 
or  allowing  such  person  the  difference  arising  by  the 
advanced  price  of  the  stocks,  were  corrupt,  infamous, 
and  dangerous  practices,  and  highly  reflecting  on  the 
honour  and  justice  of  Parliaments,  and  destructive  of 
his  Majesty’s  Government. 

‘  4.  That  any  of  the  Directors  of  the  South  Sea  Com¬ 
pany  selling  their  stock  at  high  prices  to  the  Company 
or  others,  at  the  same  time  that  they  gave  orders  for 
buying  stock  upon  account  of  the  Company,  under 
pretence  of  keeping  up  the  nominal  value  of  the  said 
stock,  was  a  scandalous  practice,  tending  to  enrich 
themselves,  to  the  great  loss  and  detriment  of  the 
Company  and  of  others  of  his  Majesty’s  subjects,  for 
which  they  ought  to  make  satisfaction  out  of  their  own 
estates. 

4  5.  That  the  declaring  a  dividend  of  thirty  per  cent, 
for  Christmas  last,  and  not  less  than  fifty  per  cent, 
per  annum  for  not  less  than  twelve  years  after,  was  an 
infamous  contrivance  to  give  his  Majesty’s  subjects 
false  notions  of  the  value  of  the  said  stock,  that  the 
late  Directors  might  more  easily  dispose  of  their  own 
stock  at  exorbitant  prices. 

4  6.  That  the  setting  the  stock  of  the  South  Sea  Com¬ 
pany  to  sale  by  subscriptions  at  high  prices,  above  the 
intrinsic  value  of  the  same,  by  the  late  Sub- Governor, 
Deputy- Governor,  and  Directors  of  the  said  Company, 
was  a  gross  and  notorious  fraud,  and  has  been  one  great 
cause  of  the  sinking  of  the  public  credit,  and  bringing 
upon  the  nation  the  distress  it  at  present  labours  under. 

4  7.  That  the  advising  of  the  late  Sub- Governor  and 
Directors  of  the  South  Sea  Company  to  set  the  stock  of 
the  said  Company  to  sale  by  subscriptions  at  high  and 


216 


THE  SOUTH  SEA  BUBBLE 


extravagant  prices,  or  to  declare  the  high  and  extrava¬ 
gant  dividends  for  Christmas  last  and  twelve  years  after 
by  any  persons  in  the  Administration  was  a  notorious 
breach  of  the  trust  reposed  in  them,  to  the  prejudice 
of  his  Majesty’s  Government  and  the  interests  of  this 
Kingdom. 1 

4  8.  That  the  entry  in  the  cash-book  of  the  South 
Sea  Company  of  £574,500  stock  pretended  to  be  sold  for 
£1,213,575  between  the  4th  of  February,  1719  and  the 
12th  of  April  following,  was  contrived  with  a  design  to 
conceal  the  names  of  persons,  for  whose  benefit  stock 
was  taken  in  by  the  said  Company. 

4  9.  That  every  person  for  whom  stock  was  taken  in 
or  held,  such  stock  being  part  of  the  £574,500  pretending 
to  be  sold  by  the  South  Sea  Company,  from  the  4th  day 
of  February  to  the  12th  day  of  April  following,  without 
money  paid,  or  sufficient  security  given,  for  the  accept¬ 
ance  of,  and  payment  for,  such  stock,  be  obliged  to 
pay  to  the  said  Company  all  such  sums  of  money  as 
have  been  received  by  way  of  difference,  or  otherwise, 
for  such  stock  taken  in  or  held  as  aforesaid. 

4 10.  That  the  addition  of  £250,000  to  the  First  Money- 
Subscription,  after  it  had  been  declared  to  be  opened 
for  £2,000,000,  and  the  addition  of  £500,000  to  the 
Second  Money-Subscription,  after  it  had  been  declared 
to  be  opened  for  £1,000,000,  were  fraudulently  contrived 
to  give  corrupt  advantages  to  particular  persons,  and 
were  injurious  to  public  credit. 

4  11.  That  a  Bill  be  brought  in  for  the  relief  of  the 
unhappy  sufferers  in  the  South  Sea  Company.’ 

On  the  day  the  First  Report  was  read  (February  16) 
James  Craggs  the  younger,  who  had  been  Secretary  of 

1  The  House  here  adjourned  the  consideration  of  the  Report 
until  February  21,  when  it  passed  the  last  four  Resolutions, 


COMMITTEE  OF  SECRECY 


217 


State  for  the  Southern  Department  sine  March,  1718, 
died  of  smallpox  1  in  the  thirty-fifth  year  of  his  age. 
A  man  of  singular  ability,  he  had  been  foolish  enough 
to  become  implicated  in  the  South  Sea  business,  though 
the  worst  that  was  proved  against  him  was  it  was  at 
his  instigation  that  the  Duchess  of  Kendal  and  Lady 
Darlington  were  bribed  with  presents  of  stock  to  use 
their  influence  to  facilitate  the  passing  of  the  Bill 
through  Parliament.  Pope,  who  was  not  given  to 
panegyric,  addressed  to  him  an  4  Epistle,’  in  which  he 
praised  him  to  the  skies.  Indeed,  the  poet  loved  him, 
and,  after  his  death,  wrote  of  him  to  John  Cary  11 : 
4  There  never  lived  a  more  worthy  nature,  a  more 
disinterested  mind,  a  more  open  and  friendly  temper, 
than  Mr.  Craggs.  A  little  time  I  doubt  not  will  clear 
up  a  character  which  the  world  will  learn  to  value  and 
admire  when  it  has  none  such  remaining  in  it.’  From 
the  political  point  of  view,  according  to  Lord  Harley, 
4  The  death  of  Craggs  is  not  any  matter  one  way  or  the 
other,  because  he  was  determined  to  be  laid  by.’ 2 
Yet  the  loss  of  its  two  Secretaries  of  State  was  awkward 
for  the  Ministry,  since  at  this  time  it  was  vital  to  its 
existence  that  it  should  be  at  once  strong  and  united. 

Pope,  who  lamented  the  loss  of  Craggs,  was  himself 

1  ‘  The  great  debauch  which  killed  Stanhope  and  Craggs  was 
at  the  Duke  of  Newcastle’s.  They  drank  excessively  of  New 
Tokay,  Champagne,  Visney,  and  Barba  Water,  thirteen  hours, 
it  is  said.’  Lord  Harley  to  the  Earl  of  Oxford,  February  18, 
1 820 . — Portland  MSS.,  V.,  616. 

‘  Craggs  got  his  death  by  calling  at  the  gate  of  Lady  March 
(Sarah  Cadogan,  afterwards  Duchess  of  Richmond),  who  was  ill 
of  the  smallpox  ;  and  being  told  so  by  the  porter,  went  home 
directly,  fell  ill  with  the  same  distemper  and  died.’ — Horace 
Walpole  :  Reminiscences,  CXV.  (in  Vol.  I.  of  Cunningham’s 
edition  of  Walpole’s  Letters). 

2  Portland  MSS.,  V.,  616, 


218 


THE  SOUTH  SEA  BUBBLE 


at  one  time  an  investor  in  South  Sea  stock.  Craggs 
gave  him  some  South  Sea  subscriptions,  but  the  poet, 
though  usually  a  good  man  of  business,  neglected  to  bene¬ 
fit  by  them.  Subsequently  he  said  it  was  a  satisfaction 
to  him  that  he  did  not  grow  rich,  as  he  might  have  done, 
Ly  the  public  calamity. 

4  South  Sea  Subscriptions  take  who  please, 

Leave  me  but  Liberty  and  Ease, 

’Twas  what  I  said  to  Craggs  and  Child, 

Who  prais’d  my  Modesty  and  smil’d.’  1 

John  Gay,  too,  had  a  similar  present  from  the  same 
Minister,  and  at  one  time  could  have  sold  the  stock  for 
£20,000.  4  His  friends  begged  him  to  realise,  if  only 

so  much  as  would  enable  him  to  purchase  an  annuity  of 
£100,  but,’  says  Dr.  Johnson,  4  he  dreamed  of  dignity 
and  splendour,  and  could  not  bear  to  obstruct  his  own 
fortune.  .  .  .  This  counsel  was  neglected  ;  the  profit 
and  principal  were  lost,  and  Gay  sunk  under  the 
calamity  so  low  that  his  life  became  in  danger.’2  He 
recovered,  however;  became  a  Lottery  Commissioner 
for  eleven  years,  and  wrote  4  The  Beggar’s  Opera,’ 
upon  which  his  name  and  fame  principally  rests.  Yet 
a  third  man  of  letters,  Matthew  Prior,  was  interested 
in  the  4  bubble,’ but  his  fate  was  harder  than  that  of  his 
confreres.  4 1  am  concerned  to  hear  of  your  losses  in  that 
national  gulf  of  destruction,  the  South  Sea,’ 3  the  Earl 
of  Chesterfield  4  wrote  to  him ;  and  he  himself  com- 

1  Pope  :  Imitations  of  Horace ,  Book  I.,  Epistle  III.  One  of 
Pope’s  editors  says  the  allusion  is  to  Sir  Francis  Child,  but  it 
is  more  probable  that  the  allusion  is  to  Stephen  Child,  at  one 
time  a  South  Sea  Director. 

2  Lives  of  the  Poets ,  Johnson  :  Works  (ed.  1806),  X.,  240. 

3  March  1,  1721  ;  Bath  MSS.,  III.,  498. 

4  Philip  Stanhope,  third  Earl  of  Chesterfield  (d.  1726),  father 
of  the  author  of  the  famous  4  Letters.’ 


James  Craggs  the  Younger 
From  a  portrait  by  Sir  Godfrey  Kneller 


COMMITTEE  OF  SECRECY 


219 


plained  to  Swift :  4 1  am  tired  of  politics,  and  lost  in  the 
South  Sea.  The  roaring  of  the  waves,  and  the  madness 
of  the  people,  were  justly  put  together.  I  can  send 
you  no  news  that  holds  either  connection  or  sense.  It 
is  all  wilder  than  St.  Anthony’s  dream.’ 1 

1  There  is  also  extant  a  letter  from  Prior  to  the  Earl  of 
Oxford,  dated  Wimpole,  December  23,  1720  :  ‘  I  am  frightened 
with  the  roaring  of  the  South  Sea,  and  tired  with  the  madness 
of  the  people.’ — Portland  MSS.,  V.,  611. 


CHAPTER  X 


The  Fate  of  the  Directors  and  their 

Associates 


MARCH-APRIL,  1721 


HE  second  Report  of  the  Committee  of  Secrecy 


JL  was  presented  to  the  House  of  Commons  on 
February  25,  and  it  was  then  agreed  that  the  case  of 
Charles  Stanhope  should  be  taken  into  consideration 
three  days  later.  The  charges  against  him  were  two 
in  number  :  The  first,  that  £10,000  South  Sea  stock 
was  taken  in  for  his  benefit,  by  Robert  Knight,  without 
any  valuable  consideration  ;  and  that  the  difference 
arising  by  the  advanced  price  thereof  was  paid  him  out 
of  the  cash  of  the  South  Sea  Company ;  the  second, 
that  Elias  Turner  and  Co.  had  bought  £50,000  stock 
at  a  low  price  of  the  South  Sea  Company,  in  the  name  and 
for  the  benefit  of  Charles  Stanhope,  the  difference  of 
the  advanced  price  whereof,  amounting  to  £250,000,  had 
been  paid  to  the  said  Charles  Stanhope  by  Sir  George 
Caswell  and  Co.  For  the  defence,  as  regards  the  first 
count  of  the  indictment,  Sir  John  Blunt  said  that  he 
could  not  be  sure  that  the  letter  (shown  him  by  Knight 
purporting  to  come  from  Stanhope  desiring  him  to  take 
£10,000  stock  for  him)  was  genuine,  nor  did  he  know 
what  had  become  of  it ;  while,  as  regards  the  second 
count,  Sawbridge  and  Turner  declared  that  they  had 
used  his  name  without  his  knowledge.  Stanhope, 

220 


THE  FATE  OF  THE  DIRECTORS 


221 


speaking  from  his  place  in  the  House,  stated  that  he 
had  given  valuable  consideration  for  the  £10,000  stock  ; 
while  as  regards  the  rest,  he  could  not  answer  for  what 
had  been  done  without  his  consent.  A  motion  con¬ 
demning  him  was  negatived  by  180  to  177  votes.  4  You 
have  heard  of  Mr.  Stanhope’s  acquittal  by  a  majority 
of  three,  which  has  put  the  town  in  a  flame  to  such  a 
degree  as  you  cannot  imagine,’  Brodrick  wrote  to  Lord 
Middleton.  4  What  consequences  it  may  have  I  cannot 
imagine  ;  these,  I  think,  will  be  more  or  less  by  what 
shall  be  done  to-morrowr,  when  Mr.  Aislabie’s  case  comes 
on.  Lord  Stanhope  (son  to  Lord  Chesterfield)  1  carried 
off  a  pretty  many,  by  mentioning  in  the  strongest  terms 
the  late  lord  of  that  name.  Between  forty  and  fifty 
who  could  not  bring  themselves  to  give  negatives  were, 
however,  persuaded  to  withdraw  before  the  question. 
On  the  other  hand,  a  great  many  of  the  affirmatives 
are  gone  out  of  town  in  the  utmost  rage,  many  of  them 
not  really  displeased  at  what  happened,  since  it  affords 
but  too  good  a  handle  for  fomenting  greater  discontent 
in  the  country.  I  own  I  think  it  is  a  very  bad  piece  of 
policy,  for  the  whole  Kingdom  are  enraged  against  the 
South  Sea  scheme,  and  not  less  so  against  those  who 
support  their  abettors.  ...  You  will  see  by  the 
abstract  of  the  Report  that  the  proof  was  full  as  strong 
as  the  nature  of  the  thing  (Knight  being  gone)  would 
admit  of,  and  supported  by  many  concurrent  circum¬ 
stances.  Sir  John  Blunt’s  evidence  was  to  be  vilified, 
for  further  reasons  which  you’ll  easily  guess  at ;  every¬ 
body  sees  through  that.’ 2 

1  Philip  Dormer  Stanhope  (1694-1773),  known  as  Lord 
Stanhope,  succeeded  in  1726,  as  fourth  Earl  of  Chesterfield,  the 
author  of  the  ‘  Letters.’ 

2  March  7, 1721 ;  Middleton  Papers ,  quoted  in  Coxe  :  Memoirs 
of  Sir  Robert  Walpole ,  II.,  209. 


222 


THE  SOUTH  SEA  BUBBLE 


The  state  of  the  public  mind  was  in  no  whit  exagger¬ 
ated  by  Brodrick.  It  was,  indeed,  so  full  of  fury  at 
the  idea  of  being  baulked  of  its  rightful  prey,  that  those 
at  the  head  of  affairs  realised  that  a  scapegoat  must  be 
found.  It  is  said  that  Walpole  had  undertaken  to  screen 
Sunderland  and  the  German  ladies  :  there  remained, 
besides  the  smaller  fry,  only  Aislabie  and  the  elder  Craggs. 
Aislabie,  in  particular,  had  always  been  an  object  of 
suspicion,  and  rumours  had  long  been  current  as  to  his 
^hare  in  the  fraudulent  transactions.  4  Edmund  Waller, 
Aislabie’s  son-in-law,  is  supposed  to  have  been  agent  to 
his  father-in-law,’ 1  Dr.  William  Stratford  had  written  to 
Edward  Harley  so  early  as  October,  1720.  ‘  He  now  re¬ 

funds  the  money  to  all  who  bought  subscriptions  of  him, 
and  is  said  already  to  have  refunded  to  the  tune  of  £80,000. 
I  do  not  well  understand  the  policy  of  this,  and  I  am  afraid 
it  is  not  only  from  a  sense  of  probity.  I  do  not  know 
whether  it  may  be  a  proper  method  to  prevent  a 
prosecution,  but  I  am  sure  it  is  a  plain  confession  of 
guilt.’ 2 

A  man  of  good  family  and  estates,  Aislabie  had  in 
1695,  at  the  age  of  twenty-five,  entered  Parliament. 
From  1712  he  held  minor  official  posts,  and  six  years 
later,  when  Sunderland  became  First  Lord  of  the 
Treasury,  he  accepted  the  office  of  Chancellor  of  the 
Exchequer.  4  He  was  a  man  of  good  understanding, 
no  ill  speaker  in  Parliament,  and  very  capable  of  busi¬ 
ness,’  Arthur  Onslow  has  described  him  ;  4  but  dark,  and 
of  a  cunning  that  rendered  him  suspected  and  low  in 
all  men’s  opinions.  His  great  employments  did  not 
raise  any  regard  to  his  person.  He  was  much  set  upon 

1  Portland  MSS.,  VII.,  280. 

2  Thomas  Harley  to  the  Earl  of  Oxford,  February  17, 1721. — 
Portland  MSS.,  V.,  015. 


THE  FATE  OF  THE  DIRECTORS 


223 


increasing  his  fortune,  and  did  that,  and  to  obtain  a 
peerage,  which  it  is  said  he  was  promised,  but  missed 
by  the  troubles  he  fell  into  for  the  South  Sea  transactions. 
.  .  .  It  was  thought  he  was  given  up  at  Court,  by  way 
of  composition,  to  save  my  Lord  Sunderland,  and  he, 
chiefly  against  Sir  Robert  Walpole,  resented  it  accord¬ 
ingly  as  long  as  he  lived.’ 1  Aislabie  had  seen  his 
way  to  wealth  by  way  of  the  South  Sea  Company,  whose 
schemes  he  had  supported,  but  his  methods  had  been 
unscrupulous,  and  when  they  were  disclosed  he  had  to 
pay  the  penalty. 

The  Commons,  on  March  8,  took  into  consideration 
those  parts  of  the  Reports  of  the  Committee  of  Secrecy 
which  related  to  Aislabie.  An  excellent  account  of  the 
prolonged  sitting  of  the  House  on  that  day  has  been 
preserved.  ‘  Yesterday  night,  half-past  twelve,  Mr. 
Aislabie’s  fate  was  determined,  as  you  will  see  by  the 
votes,  almost  the  whole  time  being  taken  up  in  examining 
numbers  of  witnesses  (late  Directors)  called  by  him,’ 
Arthur  Brodrick  wrote  to  his  brother,  Lord  Middleton. 
‘  The  questions  proposed  were  the  same  to  them  all, 
viz.,  whether  they  knew,  or  had  heard,  of  any  fictitious 
stock  taken  in,  or  held  for  him,  or  of  any  stock  bought 
for  his  use  with  the  Company’s  money,  to  every  one  of 
which  they  all  answered  roundly  in  the  negative,  from 
whence  he  argued  the  certainty,  and  as  he  expressed 
himself  even  to  a  demonstration  of  his  innocence,  for 
that  it  was  not  to  be  conceived  but  they  must  have 
known  the  thing.  As  to  the  proceedings  of  the  Directors 
(to  whom  he  gave  all  the  hard  names  he  could  think  of) 
his  plea  was  ignorance.  To  the  charges  of  having  great 
dealings  in  stock  (pending  the  Bill)  he  said  nothing 


1  Hist.  MSS.  Com.,  Report  XVI.,  App.  Pt.  IX.,  507 


224 


THE  SOUTH  SEA  BUBBLE 


otherwise  than  by  insinuation,  that  doing  so  with  his 
own  money,  he  hoped  would  not  be  criminal.  His 
concerting  with  the  Directors  taking  in  the  first  sub¬ 
scription  at  £300  per  cent,  he  dropped,  not  saying  one 
word  to  the  charge  ;  but  an  incident  happened,  which 
gave  great  disgust  to  the  House.  The  Second  Report 
takes  great  notice  of  dealings  in  stock  between  him  and 
Mr.  Hawes  (formerly  his  clerk  when  Treasurer  of  the 
Navy),1  who  had  informed  the  Committee  that  those 
accounts  were  finally  adjusted  in  November  last,  when 
Mr.  Aislabie  insisted  on  having  Mr.  Hawes’s  book  (of 
which  he  had  a  duplicate)  delivered  him  that  no  one 
might  see  it,  which  was  done  accordingly  upon  his 
giving  Hawes  a  general  release.  On  Tuesday  a  motion 
was  made  for  his  laying  that  book  before  the  House 
as  yesterday,  which  he  opposed,  as  what  the  House 
could  not  demand,  for  that  it  related  only  to  his  private 
account  with  Hawes,  but  was  overruled  by  the  House, 
and  ordered  to  bring  in  the  book  ;  wherewith  not  com¬ 
plying,  notice  was  taken  of  it  in  the  House.  He  then 
desired  Mr.  Hawes  might  be  examined,  who  said  at 
the  bar  that  when  he  delivered  up  the  book,  both  that 
and  the  duplicate  (in  Mr.  Aislabie’s  hands)  were  burnt, 
of  which  Mr.  Hawes  made  no  mention  when  examined 
by  the  Committee,  nor  did  Mr.  Aislabie  on  Tuesday ; 
from  whence  it  was  concluded  that  this  was  an  after¬ 
thought,  and  the  books  burnt  (if  at  all)  ex  post  facto . 
He  had  on  Tuesday  imprudently  enough  said,  that  if 
the  Committee  should  have  demanded  those  books,  he 
would  have  burnt  them  before  their  faces.’ 2  The 

1  Aislabie  was  Treasurer  of  the  Navy  from  1714  until  March, 
1718. 

2  Middleton  Papers ,  quoted  in  Coxe  :  Memoirs  of  Sir 
Robert  Walpole ,  II.,  209. 


THE  FATE  OF  THE  DIRECTORS  225 


proofs  were  overwhelming,  and  Aislabie  was  declared 
guilty  of  the  4  most  notorious,  dangerous,  and  infamous 
corruption.’  Twelve  Resolutions  were  passed  unani¬ 
mously,  the  eleventh  being, 4  That  the  said  John  Aislabie, 
Esq.,  has  encouraged  the  dangerous  and  destructive 
execution  of  the  late  South  Sea  scheme,  with  a  view  to 
his  own  exorbitant  profit,  and  has  combined  with  the 
late  Directors  of  the  South  Sea  Company  in  their  per¬ 
nicious  practices,  to  the  detriment  of  the  great  numbers 
of  His  Majesty’s  subjects  and  the  ruin  of  the  public 
credit  and  trade  of  this  Kingdom.’  The  last  Resolution 
decreed  that  he  be,  for  his  said  offences,  expelled  this 
House.  He  was  then  committed  to  the  Towrer,  and  it 
was  ordered  that  an  account  of  his  state  be  taken.  In 
due  course  this  was  done,  and  the  particulars  submitted 
to  the  House,  where  on  June  10  it  was  warmly  debated 
about  the  time  as  to  when  the  forfeiture  should  relate. 
Walpole  and  the  Court  party  were  for  carrying  it  only  to 
December,  1719,  but  it  was  realised  that  this  would 
produce  little  or  nothing ;  whereupon  Jekyll  proposed 
to  take  it  back  to  1714  when  Aislabie  was  appointed 
Treasurer  of  the  Navy.  Eventually  it  was  decided  by 
113  to  95  votes  that  he  should  retain  the  property  he 
had  on  or  before  March  18,  1718,  when  he  became 
Chancellor  of  the  Exchequer.  He  was,  therefore,  let 
off  lightly,  as  he  was  able  to  preserve  the  paternal 
estate  of  Studley  Royal,  on  which  he  resided  until  his 
death  at  the  age  of  seventy- one  in  1742. 

In  spite  of  what  Arthur  Onslow  said  as  to  Aislabie’s 
anger  against  Walpole,  it  may  be  that  this  was  not 
exactly  the  case.  Certainly  again  and  again  Walpole 
did  all  he  could  to  lighten  the  punishment  of  the  fallen 
Minister,  and  he  spoke  more  than  once  in  mitigation 
of  penalties  to  be  inflicted  upon  him.  He  even  risked 

0 


226 


THE  SOUTH  SEA  BUBBLE 


some  of  his  regained  popularity,  when  on  April  20, 
on  the  second  reading  of  the  Bill  for  restraining  Aislabie 
6  from  going  out  of  the  Kingdom,  etc.,  and  for  discovering 
his  effects,’  he  opposed,  though  in  vain,  the  proposal 
to  consolidate  this  with  the  Directors’  Bill,  urging 
‘  that  it  would  seem  hard  to  put  a  person  of  Mr.  Aislabie’s 
eminence  and  distinction  on  the  same  level  with  the 
Directors,  and  that  such  a  precedent  might  be  of  dan¬ 
gerous  consequences.’  Indeed,  Aislabie  himself  was 
at  pains  to  state  his  gratitude  in  unmistakable  terms. 
4 1  am  extremely  sensible  of  your  generosity,  and  am 
more  ashamed  of  my  own  follies  and  mistakes  than  any 
severe  treatment  I  might  deserve  at  your  hands  could 
make  me.  Since  you  have  been  so  good  to  promise  to 
forget  what  is  passed,  I  shall  not  put  you  in  mind  of  it 
any  further  than  to  return  you  my  most  hearty  thanks,’ 
he  wrote  on  February  2,  1722.  4  1  have  sent  you  an 

account  of  the  King’s  stock,  with  all  the  dividends  as 
they  were  received  by  Sir  Charles  Vernon,  to  whom  the 
stock  was  transferred.  I  have  accounted  with  him 
this  morning,  and  he  has  bought  the  stock  that  was 
pawned  to  him,  and  paid  me  the  balance,  so  that  at 
last  I  have  raised  as  much  as  will  pay  the  King,  and 
shall  have  it  ready  against  Monday  night,  if  you  please 
to  let  me  know  to  whom  I  must  pay  it.  I  have  likewise 
sent  you  a  state  of  my  own  account  before  the  judges, 
by  which  you  will  see  my  estate  is  not  so  great  as  is 
represented,  since  I  must  take  all  the  bad  debts  to 
myself.  The  trustees  are  both  very  civil  to  me,  and  I 
am  very  sensible  to  whom  I  owe  it.  The  judges  meet 
on  Wednesday  next,  when  the  Chief  Justice  Pratt  will 
be  there.  If  he  and  Judge  Fortescue  be  well  inclined,  I 
hope  to  make  an  end  of  it.  The  doubt  they  make  at 
present  is,  whether  £29,000  public  money,  which  was 


THE  FATE  OF  THE  DIRECTORS 


227 


in  Mr.  Hawes’s  hands  October,  1718,  be  part  of  the  effects 
I  had  in  other  people’s  hands  at  that  time,  and  which 
I  had  invested  in  stocks  some  time  after  all  the  public 
money  was  paid  away.  As  this  can  scarce  be  a  point, 
yet  being  matter  of  account,  they  do  not  take  it  readily. 
I  beg  that  you  will  assist  me  to  make  an  end  of  this 
matter,  in  such  manner  as  you  think  proper,  that  you 
may  see,  by  making  me  free,  you  have  made  me  your 
creature  and  your  most  obliged  faithful  servant.’ 1 

When  the  Directors’  Bill  went  up  to  the  House  of 
Lords,  Aislabie  made  a  last  effort  to  retain  possession 
of  his  ill-gotten  gains.  He  petitioned  to  be  heard  by 
counsel,  but  his  application  was  refused,  Lord  Townshend 
declaring  that  the  late  Chancellor  of  the  Exchequer 
had  4  done  more  mischief  than  any  man  in  the  nation. 
He  was,  however,  allowed  to  appear  at  the  bar,  and 
there,  speaking  in  his  own  defence,  he  urged  that  there 
was  not  sufficient  evidence  against  him  to  give  ground  for 
inserting  his  name  in  the  Bill  and  subjecting  him  to 
the  penalties  enacted  by  it.  He  spoke  at  length,  and 
spoke  well,  and  undoubtedly  made  the  best  of  his  case. 
He  showed  that  this  man’s  evidence  clashed  with  that 
man’s  ;  that  the  word  of  a  third  party,  that  party 
being  himself  guilty,  was  untrustworthy  ;  he  insisted 
that  he  had  paid  for  certain  stock ;  he  complained 
that  at  the  eleventh  hour  fresh  charges  were  brought 
against  him  which  he  had  no  opportunity  to  refute  ; 
he  denied  that  his  son-in-law,  Edmund  Waller,  had 
dealt  in  the  stock  on  his  account.  He  talked  all  round 
the  matter.  He  declared  that  he  was  bitterly  opposed 
to  the  South  Sea  scheme,  which  he  was  from  the  first 

1  Oxford  Papers,  quoted  in  Coxe’s  Memoirs  of  Sir  Bobert 
Walpole,  II.,  220. 


228 


THE  SOUTH  SEA  BUBBLE 


convinced  must  prove  injurious  to  the  nation  ;  yet  he 
could  not  but  allow  that,  when  overruled,  he,  albeit 
responsible  for  the  finances  of  the  country,  instead  of 
resigning,  actually  advocated  it  from  his  place  in  the 
House  of  Commons.  He  stated  categorically  that  he 
had  not  made  money  out  of  the  South  Sea  Company  ; 
yet  he  was  unable  to  explain  by  what  other  means  he 
had  contrived  so  greatly  to  increase  his  fortune.  The 
Lords  listened  patiently,  and  then,  nem.  con.,  found  that 
there  was  sufficient  evidence  to  have  his  name  con¬ 
tinued  in  the  Bill. 

Two  days  after  Aislabie’s  case  had  been  considered 
in  the  House  of  Commons,  that  is  on  March  2,  Sir  George 
Caswell  was  summoned  before  that  Assembly.  The 
principal  charge  against  him  was  that  he  had  taken  in  for 
himself  and  his  partners,  Elias  Turner  and  Jacob  Saw- 
bridge,  £50,000  of  the  £574,000  fictitious  stock  to  which 
reference  has  already  been  made,  without  payment  or 
giving  valuable  security.  Rising  in  his  place,  Caswell, 
in  his  defence,  declared  that  he  had  made  a  lawful 
bargain  for  the  stock,  and  had  several  times  offered  to 
pay  the  value  of  it,  but  was  put  off  from  time  to  time 
by  Robert  Knight,  who  told  him  that  he  was  not  at 
leisure  to  make  up  accounts  with  him  and  that  he  had 
sufficient  security  in  his  hands.  Although  witnesses 
were  called  in  support  of  this  contention,  the  House 
showed  its  disbelief  in  the  story  by  finding  him  guilty 
by  227  to  92  votes.  Then  Caswell  spoke  again,  this 
time  in  mitigation  of  sentence.  4 1  must  express  my 
great  sorrow,’  he  said,  4  that  I  have  the  misfortune  to 
fall  under  the  displeasure  of  the  House,  which  lies  the 
more  heavy  upon  me  because  I  am  not  conscious  of  any 
crime,  unless  it  be  the  extraordinary  zeal  and  affection 
I  have  shown  for  the  support  of  the  present  happy  settle- 


THE  FATE  OF  THE  DIRECTORS  229 


ment,  having  assisted  the  Government  with  vast  sums 
of  money  at  three  per  cent,  which  they  could  get  nowhere 
else.  For  the  truth  of  this  I  appeal  to  members  of  the 
House,  who  were  then  Commissioners  of  the  Treasury.’ 
The  loans  were  admitted  by  William  Clayton,  an  ex- 
Lord  of  the  Treasury,  but  it  was  generally  thought  that 
Caswell’s  guilt  so  far  outweighed  his  services  that  he  was 
expelled  from  the  House  and  committed  to  the  Tower, 
while  the  estates  of  himself  and  his  partners  were  held 
liable  for  the  £250,000  profit  made  out  of  the  illicit 
transaction. 

Possibly  Caswell  might  have  been  let  down  more 
lightly — though  in  the  interests  of  justice  there  was  no 
reason  for  it — but  that  the  country  was  evincing  nothing 
short  of  fury  at  the  idea  of  the  projectors  of  the  ruinous 
scheme  escaping.  4  The  resentment  without  doors  ever 
since  the  acquittal  of  Stanhope  has  very  much  contri¬ 
buted  to  carry  matters  to  this  height,’ 1  W.  Thomas 
wrote  to  the  Earl  of  Oxford,  concerning  Caswell’s  sen¬ 
tence.  The  conviction  of  Aislabie  and  Caswell  somewhat 
eased  the  situation.  ‘  It  is  not  to  be  conceived  what 
satisfaction  these  two  days’  work  has  given,  and  indeed 
it  is  well  it  so  happens,  for  the  rage  has  grown  to  such 
height  upon  the  acquittal  of  Stanhope,  that  no  man 
can  tell  where  it  would  have  ended,’  Brodrick  wrote  to 
Lord  Middleton.  4  Bonfires  were  made  in  the  City 
the  day  Mr.  Aislabie  went  to  the  Tower.’ 1  2  The  public 
feeling  was  further  displayed  in  a  cartoon,  entitled  4  A 
Late  Member.’  By  the  side  of  the  principal  figure  was 
another,  dressed  as  Punch,  displaying  an  empty  purse, 

1  March  10,  1721  ;  Portland  MSS.,  V.,  617. 

2  March  11,  1721  ;  Middleton  Papers ,  quoted  in  Coxe’s 
Memoirs  of  Sir  Robert  Walpole,  II.,  212. 


230 


THE  SOUTH  SEA  BUBBLE 


and  saying,  c  This  is  the  service  you  have  done  the 
nation.’  Beneath  the  design  were  these  lines  : — 

‘  In  this  same  figure  men  may  plainly  see 
Th’  ambitious  author  of  their  miserie  ; 

Behold  his  mighty  sword,  his  back,  his  nose, 

All  are  joint  emblems  of  the  nation’s  foes, 

Besides  his  zany’s  cap,  and  snearing  grins, 

Denote  what  we  have  all  deserved  long  since  ; 

Look  at  his  empty  purse,  and  that  alone 
Will  show  how  rich  our  English  fools  are  grown.’ 

The  delight  of  the  nation  that  some  at  least  of  those 
responsible  for  its  sufferings  were  being  dealt  with  ac¬ 
cording  to  their  deserts  found  expression  in  the  muse  of 
the  minor  poets. 

THE  ASS  AND  THE  THISTLE 

A  wise  man  laugh’d  to  see  an  ass 
Eat  thistles  and  neglect  good  grass  ; 

But  had  the  sage  beheld  the  folly 
Of  late  transacted  in  Exchange  Alley, 

He  might  have  seen  worse  asses  there 
Give  solid  gold  for  empty  air, 

And  sell  estates  in  hopes  to  double 
Their  fortunes  by  some  worthless  Bubble, 

’Till  of  a  sudden  all  was  lost, 

That  had  so  many  millions  cost : 

Yes,  ruin’d  fools  are  highly  pleas’d 
To  see  the  knaves  that  bit  ’em  squeez’d, 
Forgetting  where  the  money  flies, 

That  cost  so  many  tears  and  sighs. 

At  last  the  House  decided  to  consider  that  part  of  the 
Report  which  related  to  the  Earl  of  Sunderland.  The 
excitement  was  great,  for  it  was  known  that  Walpole 
would  do  his  utmost  to  secure  the  acquittal  of  the  First 
Lord  of  the  Treasury,  and  it  was  also  a  foregone  con¬ 
clusion  that  if  an  acquittal  was  not  secured  the  Govern¬ 
ment  would  topple  over  like  a  house  of  cards.  Jekyll, 
on  March  14,  moved  a  resolution,  ‘  That  it  appears  to 


Charles,  Third  Earl  of  Sunderland 

From  a  contemporary  print 


P •  230 


THE  FATE  OF  THE  DIRECTORS 


231 


this  House  that,  after  the  proposals  of  the  South  Sea 
Company  were  accepted  by  the  House  and  a  Bill  ordered 
to  be  brought  in  thereupon,  and  before  such  Bill  passed, 
£50,000  of  the  capital  stock  of  the  South  Sea  Company 
was  taken  in  by  Robert  Knight,  late  Cashier  of  the  said 
Company,  for  the  use  and  upon  the  account  of  Charles, 
Earl  of  Sunderland,  a  Lord  of  Parliament,  and  First 
Commissioner  of  the  Treasury,  without  any  valuable 
consideration  paid,  or  sufficient  security  given,  for  pay¬ 
ment  for,  or  acceptance  of,  the  same.5  The  debate 
was,  however,  postponed  for  a  day  at  the  instance  of 
Walpole,  who  stated  that  it  would  be  necessary  for  the 
further  information  of  the  House  that  the  several  wit¬ 
nesses,  who  had  been  examined  by  the  Committee  of 
Secrecy,  might  be  examined  at  the  bar,  since  possibly 
they  might  not  come  up  in  every  particular  whereof 
they  had  informed  the  Committee,  or  might  so  far 
explain  their  meanings  as  to  give  a  very  different  turn 
from  what  the  words  of  their  examination  might  pos¬ 
sibly  import.  c  We  well  foresaw  gaining  a  night  was 
chiefly  in  view,5  Brodrick  wrote  to  Lord  Middleton  ; 
‘  and  it  had  (in  my  opinion)  its  effect,  for  when  they 
came  to  be  examined  upon  cross  questions,  every  one 
of  them  strengthened  the  Report.  Among  the  rest 
ordered  to  attend  Sir  John  Blunt  was  one ;  but  his 
Lordship’s  advocates  did  not  think  fit  to  call  him  in. 
The  abstract  of  the  Report  which  you  have,  will  evince 
the  strength  of  the  case,  which  I  own  I  think  fuller 
proved  (and  so  I  said)  than  any  of  the  three  cases  which 
had  been  under  consideration.  The  defence  made  was 
entirely  different  from  what  I  expected,  there  being  (as 
I  apprehended)  no  room  left  for  denying  the  fact,  where¬ 
fore  I  concluded  the  sufficiency  of  the  security  (his 
Lordship’s  note,  sworn  to  have  been  shown  Sir  J.  Blunt 


232 


THE  SOUTH  SEA  BUBBLE 


by  Knight)  would  have  been  insisted  upon ;  but  that 
point  was  given  up,  and  his  Lordship’s  denial  of  any 
stock  taken,  or  note  given,  was  the  subject  of  three 
hours’  debate,  after  all  the  papers  read  and  witnesses 
examined.  By  way  of  negative  proof,  Mr.  Pelham, 
brother  to  the  Duke  of  Newcastle,  and  Mr.  Walpole 
informed  the  House  that  his  Lordship  had  empowered 
them  to  declare,  that  no  stock  had  ever  been  taken  in 
for  him  by  Knight,  or  note  given,  so  that  the  question 
in  truth  was  neither  more  nor  less  than  whether  we 
should  give  credit  to  that  assertion  or  Sir  J.  Blunt’s 
oath.  A  good  deal  of  pains  was  taken  to  falsify  that 
oath  by  asking  the  witnesses  at  the  bar  whether  Knight 
had  told  them  of  this  stock  being  taken  in  in  presence 
and  hearing  of  Sir  John  Blunt  (as  he  had  sworn).  They 
owned  Knight’s  telling  them  of  the  stock  so  taken  in  for 
Lord  Sunderland.  One  of  them  said  he  was  alone  when 
Knight  told  him  of  it ;  two  others  owned  Sir  John’s 
being  in  the  room  when  he  told  them,  but  did  not  believe 
him  within  hearing  of  what  Knight  said.  Such  trifling 
stuff  was  surely  never  insisted  upon  in  any  other  case, 
and  would  in  any  other  have  been  the  strongest  proof 
of  the  case.  It  was  foreseen  too  well  that  such  a  defence 
was  not  to  be  relied  upon,  and  therefore  the  sheet  anchor 
was  Lord  Oxford’s  play.  If  you  come  into  this  vote 
against  Lord  Sunderland,  the  Ministry  are  blown  up, 
and  must,  and  necessarily  will,  be  succeeded  by  a  Tory 
one.  I  really  think  I  never  heard  anything  better  de¬ 
bated  on  the  one  part,  or  more  weakly  on  the  other ; 
but  Sir  J.  Walker’s  argument  of  monosyllable  was  the 
best  refuge.’  1 

Jekyll  proposed  the  question  with,  it  is  stated,  4  some 

1  March  16,  1721  ;  Middleton  Papers ,  quoted  in  Coxe’s 
Memoirs  of  Sir  Bobert  Walpole ,  II.,  213. 


THE  FATE  OF  THE  DIRECTORS  233 


personal  reflections  ’ 1 2 — 4  no  one,’  said  another,  4  was 
at  once  so  warm  and  inveterate  as  Jekyll 5  2 — and  Sir 
Thomas  Hanmer  3  followed  on  in  attack.  Walpole 
spoke  eloquently  in  defence,  only  to  be  reminded  by 
Shippen  of  what  he  had  said  in  the  previous  year  against 
the  same  person.  In  the  end,  after  a  heated  debate, 
the  resolution  was  negatived  by  233  to  172  votes.  Wal¬ 
pole  and  his  friends  voted  for  rejection ;  but  it  was 
noticed  that  the  followers  of  the  Prince  of  Wales,  who 
was  in  the  gallery,  divided  against  Lord  Sunder¬ 
land. 

It  is  impossible,  on  the  evidence  that  has  come  down 
to  posterity,  to  say  whether  Lord  Sunderland  was  inno¬ 
cent  or  guilty,  though,  as  a  contemporary  remarked, 
4  a  172  was  a  great  number  against  a  Prime  Minister.’  4 
Brodrick  certainly  thought  him  guilty,  though  he  be¬ 
lieved  him  less  a  knave  than  a  dupe  of  the  Directors; 
but  others,  whose  opinions  carry  weight,  did  not  agree 
with  him.  It  is  certain  that  Lord  Sunderland  held  South 
Sea  stock  ;  but  Drummond,  writing  to  Daniel  Pulteney, 
states,  4  As  all  Lord  Sunderland’s  friends,  by  Sir  John 
Blunt’s  advice,  sold  out  nothing,  his  Lordship  is  now 
glad  it  is  so,  for  he  would  not  have  profited  of  the  public 
calamity.’ 5  Others  spoke  in  favour  of  the  Minister. 
4  As  to  my  Lord  Sunderland’s  case  the  other  day,’  Sir 

1  March  1G,  1721  ;  Edward  Harley  to  Lord  Oxford. — 
Portland  MSS.,  V.,  618. 

2  March  19,  1721  ;  Edward  Harley,  junr.,  to  his  aunt, 
Abigail  Harley. — Ibid. 

3  Sir  Thomas  Hanmer,  fourth  baronet  (1677-1746),  M.P.  for 
Suffolk  ;  Speaker  of  the  House  of  Commons,  1714-1715. 

4  March  19,  1721  ;  Edward  Harley,  junr.,  to  Abigail  Harley. 
— Portland  MSS.,  V.,  618. 

5  November  24,  1720  ;  Pulteney  Papers,  quoted  in  Coxe’s 
Memoirs  of  Sir  Robert  Walpole ,  II.,  195. 


234 


THE  SOUTH  SEA  BUBBLE 


John  Vanbrugh  1  wrote  to  the  Earl  of  Carlisle,  ‘  it  is 
certain  there  was  no  sort  of  proof  upon  him  worth 
naming,  scarce  enough  even  to  leave  a  suspicion,  so  that 
the  attack  has  done  him  service.  And  yet  the  clamour 
runs  so  high  against  almost  any  Minister  in  power  while 
this  vile  mistake  was  made  that  many  think  a  change 
would  be  (or  perhaps  will  be)  quite  necessary ;  but 
where  to  change  is  the  great  difficulty.’ 2  In  the  same 
vein  Arthur  Onslow  wrote  to  the  Hon.  John  Molesworth. 
6  Notwithstanding  my  constant  voting  against  the 
others  who  have  come  under  our  cognisance,’  he  said,  1 1 
have  the  highest  satisfaction  in  having  given  my  assent 
to  Lord  Sunderland’s  acquittal.  This  affair  has  made 
a  great  noise  all  over  Europe,  I  don’t  doubt,  and  you 
have  had,  to  be  sure,  large  accounts  of  it  from  your 
friends  here,  whether  to  his  advantage  or  not,  I  can’t  say, 
but  you  may  depend  on  this,  that  if  we  had  condemned 
him  upon  that  evidence  which  was  before  us,  we  had  done 
the  most  unjust  thing  in  the  world,  and  what  would  have 
made  every  man,  though  the  most  innocent,  in  danger 
of  censure,  should  his  misfortunes  bring  him  before  our 
tribunal.’ 3  It  must  be  admitted  that  to  some  extent 
Onslow  changed  his  mind,  for,  in  his  4  Anecdotes,’  he 
notes  :  4  How  far  he  was  guilty  I  will  not  take  upon  me 
to  say,  because  the  evidence  against  him  was  undoubtedly 
not  so  strong  as  against  the  others,  but  the  money 
he  left  which  soon  afterwards,  upon  his  death,  appeared 
to  have  been  acquired  about  this  time,  did  pretty  nearly 
tally  to  the  profit  he  was  charged  to  have  received  from 
the  favour  of  the  South  Sea  Company.’ 4  To  put 

1  Sir  John  Vanbrugh  (1664-1726),  dramatist  and  architect. 

2  Carlisle  MSS.,  32. 

3  May  6,  1721  ;  MSS.  in  Various  Collections,  VIII.,  308. 

4  Hist.  MSS.  Com.,  Report  XVI.,  App.  Pt.  IX.,  508. 


THE  FATE  OF  THE  DIRECTORS  235 


against  this,  there  is  the  statement  of  his  biographer, 
that  neither  he  nor  his  immediate  friends  enriched 
themselves.1 

It  had  been  proposed  that  after  the  case  of  Lord 
Sunderland  had  been  dealt  with,  that  of  the  elder  Craggs 
should  be  taken,  but  in  the  meantime  Craggs  died.  The 
cause  of  his  death  has  never  definitely  been  settled. 
There  were  rumours  that  he  had  taken  poison  rather 
than  appear  before  the  House,  but  another  account 
favours  the  theory  of  a  natural  death  :  4  whether  the 
terror  of  his  approaching  trial,  or  the  loss  of  a  beloved 
son,  for  whom  he  had  been  amassing  vast  riches,  cast 
a  gloom  upon  his  spirit,  he  died  ...  in  a  lethargick  fit.’ 2 
Craggs  was  a  wonderful  man,  and  had  risen  from  small 
beginnings.  At  the  age  of  twenty-seven,  steward  to 
the  Duke  of  Norfolk  in  1684,  he  was  presently  taken 
into  the  household  of  the  Duke  of  Marlborough,  and 
later  became  an  army  clothier,  being  in  1695  committed 
to  the  Tower  for  refusing  to  show  his  books  to  the  com¬ 
missioner  of  public  accounts.  Through  the  influence 
of  the  Duchess  of  Marlborough,  he  was  given  a  minor 
official  post  in  1702,  and  for  the  next  eleven  years  he 
held  various  unimportant  posts.  At  the  end  of  1714 
he  was  appointed  Joint- Postmaster-General  with  Charles, 
fourth  Lord  Cornwallis,  and  from  that  time  he  began 
to  amass  wealth.  4  His  office  of  Postmaster- General 
obliged  him  to  live  in  the  City,  but  he  resided  there 
rather  as  a  Minister  of  the  Court  to  govern  that  body 
of  people  with  whom  he  had  formerly  been  much  con¬ 
versant  than  for  the  particular  duty  of  his  employment, 
which  he  regarded  much  less  than  the  other,’  Arthur 
Onslow  has  written.  4  He  was,  therefore,  the  principal 

1  G.  Le  Gris  Norgate  in  the  Dictionary  of  National  Biography. 

2  Political  State  of  Great  Britain ,  XXI.,  312. 


236 


THE  SOUTH  SEA  BUBBLE 


agent  for  the  Administration  in  the  whole  transaction 
of  the  South  Sea  project,  and  bore  the  chief  blame  for 
all  the  iniquity  of  it,  as  an  accomplice  with  the  leading 
Director,  and,  having  made  an  immense  gain  by  the  stock, 
and  being  a  man  generally  detested,  he  was  soon  marked 
out  for  a  sacrifice  to  the  indignation  of  the  people. 
His  great  spirit  not  brooking  this,  and  knowing  the 
severity,  as  he  called  it,  of  a  House  of  Commons  examina¬ 
tion,  and  having  just  lost  his  son  by  the  smallpox,  he 
died  soon  afterwards,  not  without  very  strong  suspicions 
of  having  used  violence  to  himself.’ 1  Parliament  cer¬ 
tainly  took  the  view  that  he  was  largely  responsible  for 
the  trouble,  since,  in  spite  of  the  fact  that  he  was  dead, 
the  House  of  Commons,  after  considering  his  case  on 
April  28,  passed  a  resolution,  4  That  James  Craggs  the 
elder,  Esq.,  was  a  notorious  accomplice  and  confederate 
with  the  said  Robert  Knight  and  some  of  the  late 
Directors  of  the  South  Sea  Company,  in  carrying  on 
their  corrupt  and  scandalous  practices,  and  did  by  his 
wicked  influence  and  for  his  own  exorbitant  gain  pro¬ 
mote  and  encourage  the  pernicious  execution  of  the 
late  South  Sea  scheme.’  His  estate  was  valued  at 
£1,500,000,  and  it  was  ordered  that  all  his  gains  since 
December  1,  1719 — no  inconsiderable  amount — should 
be  applied  to  the  relief  of  the  South  Sea  sufferers. 


1  Hist.  MSS.  Com.,  Report  XVI.,  App.  IX„  fill. 


o 

r^. 


Monument  Dedicated  to  Posterity,  1720 
hvom  a  contemporary  print  in  the  Guildhall  Library 


CHAPTER  XI 


The  Restoration  of  the  Public  Credit 


MAY-AUGUST,  1721 


WHILE  the  Committee  of  Secrecy  had  pursued  its 
investigation  with  commendable  rapidity,  and 
the  guilty  persons  had  been  arraigned  and  punished 
without  undue  delay,  there  was  all  the  time  a  general 
feeling  that  the  Government  had  not  been  moving 
quickly  enough  in  the  matter  of  granting  relief  to  those 
who  had  suffered  by  the  malpractices  of  the  Directors 
and  their  associates.  The  fact  was  that,  for  the  time 
being,  the  whole  country  was  paralysed.  4  The  South  Sea 
is  so  hateful  a  subject  one  does  not  love  to  name  it,  and 
yet  it  does  so  interfere  with  almost  everybody’s  affairs 
more  or  less,  that  all  they  have  to  do  is  in  some  degree 
governed  by  it,’  Sir  John  Vanbrugh  wrote  to  Lord  Car¬ 
lisle.  4  Even  I,  who  have  not  gained  at  all,  shall  prob¬ 
ably  be  a  loser  near  £2,000.  I  would,  however,  fain  see 
an  end  on  it  before  I  come  away  if  I  could ;  for  when 
I  know  the  worst  of  anything  I  can  make  myself  toler¬ 
ably  easy.  But  I’m  afraid  the  Parliament  will  be 
forced  to  sit  on  a  great  while  before  they  can  agree  to 
settle  anything.  And  wThat  new  work  Knight  may 
start,  if  they  get  him  to  them,  God  knows.  But  I  take 
it  for  granted,  if  he  is  like  to  tell  them  half  so  much  as 
they  have  a  mind  he  should  do,  they’ll  never  have  his 

237 


238 


THE  SOUTH  SEA  BUBBLE 


company.’ 1  It  is  true  that  the  Engrafting  Bill  had 
received  the  Royal  Assent  in  March,  but  even  if  it  had 
been  put  into  operation  it  would  have  provided  only  a 
partial  remedy.  The  way  for  progress  had  now  been 
made  more  easy  by  the  retirement  of  Lord  Sunderland, 
and  by  the  appointment  on  April  3  of  Walpole  as  First 
Lord  of  the  Treasury  and  Chancellor  of  the  Exchequer. 
Though  few  had  wished  Lord  Sunderland  to  retain 
office,  the  new  Prime  Minister  was  not  acceptable  to  all. 
4  If  your  Lordship  has  the  Weekly  London  Journal ,  you 
see  with  what  a  bitterness  the  Ministers  are  followed,’ 
Sir  John  Vanbrugh  wrote  to  Lord  Carlisle,  April  22. 
4  And  few  people  seem  much  disturbed  at  that  paper, 
though  I  believe  it  would  be  hard  for  them  to  say  where 
they  could  change  to  any  purpose.  My  Lord  Moles  worth 
is  reckoned  the  chief  author  of  the  Journal .’ 2 

The  matter  of  the  South  Sea  Company  was  re-opened  in 
the  Commons  on  April  25  by  William  Shippen,  who  all 
along  had  been  much  to  the  fore  in  discussions  on  the 
proceedings.  4  The  House  has  sat  a  long  while,  and 
nothing  yet  has  been  done  towards  the  restoring  of 
public  credit,’  he  complained.  4  Indeed,  a  member 
of  great  parts  and  ability  [Walpole]  did  at  first  propose 
a  scheme  for  that  purpose,  but  instead  of  providing  an 
effectual  remedy,  it  appeared  at  last  to  be  a  mere  palli¬ 
ative,  which  has  rather  inflamed  than  alleviated  the 
disasters.’  Walpole  did  not  sit  quiet  under  the  attack. 
4  It  is  known  to  everybody,’  he  declared,  4  that  I  have 
ever  been  against  the  South  Sea  scheme,  and  did  all 
that  lay  in  my  power  to  prevent  its  taking  place  ;  but 
now  the  mischief  has  been  done,  and  things  are  brought 
to  an  extremity,  I  think  it  my  duty,  and  therefore  am 

1  March  25,  1721  ;  Carlisle  MSS.,  32. 

2  Ibid.,  33. 


RESTORATION  OF  CREDIT 


239 


willing  to  try  the  best  method  I  can  think  of,  to  extri¬ 
cate  the  nation  out  of  the  difficulties  into  which  it  is 
plunged.  I  do  not  pretend  to  work  miracles,  but  only 
to  use  my  utmost  endeavours  towards  retrieving  the 
late  misfortunes.  With  this  honest  intention  I  pro¬ 
moted  a  scheme  that  had  been  laid  before  me,  and 
appeared  the  most  plausible  of  any  then  proposed  to 
restoring  public  credit.  It  cannot  be  denied  that  while 
this  scheme  was  pursued,  it  did  some  good  and  kept 
up  the  price  of  stocks  ;  and  that  they  have  fallen  since 
it  was  laid  aside ;  but  I  never  intended  to  raise  stock 
above  the  intrinsic  value,  for  that  would  bring  us  again 
into  the  same  unhappy  circumstances  which  the  raising 
of  them  occasioned.’  He  then  struck  a  blow  at  some 
of  his  opponents  by  expressing  regret  that  there  were 
some  persons  who,  instead  of  endeavouring  to  do  what 
was  possible  to  mitigate  the  anger  of  the  public,  were 
using  all  means  in  their  power  to  irritate  and  exasperate 
the  minds  of  the  people.  On  May  2,  to  which  date  the 
debate  had  been  adjourned,  Shippen  caused  a  great 
sensation  by  making  a  comparison  between  the  Duchess 
of  Kendal,  who  had  had  a  considerable  quantity  of  South 
Sea  stock  given  her,  and  Alice  Pearce,  the  mistress  of 
Edward  III.,  who,  having  made  a  breach  between  the 
King  and  the  Black  Prince,  was  twice  removed  from  the 
Court  by  the  interposition  and  solicitation  of  the  then 
Speaker  of  the  House  of  Commons.  This,  however,  was 
merely  a  side  issue,  and  William  Sloper  brought  the 
matter  again  within  the  realms  of  practical  politics  by 
reiterating  the  statement,  now  so  familiar,  that  one  of 
the  principal  causes  of  the  ruin  of  public  credit  was 
the  fraudulent  dealings  of  the  South  Sea  Directors  with 
the  proprietors  of  the  public  debts  and  with  the  money- 
subsciibers.  A  more  practical  step  was  taken  by 


240 


THE  SOUTH  SEA  BUBBLE 


James  Milner,  who  moved  that  the  £7,000,000  due  to 
the  Company  from  the  nation  be  remitted.  This  project 
had  already  been  mooted,  and  in  many  quarters  it  was 
found  objectionable.  4  The  remission  of  the  seven 
millions  is  too  hard  for  my  philosophy,  and  puts  me 
out  of  all  patience.  What  ado  is  made  about  half  a 
dozen  !  What  shall  we  get  by  their  being  hanged,  if 
we  must  pay  seven  millions  for  the  ropes  ?  It  is  surely 
such  a  thing  as  never  was  mentioned  before  in  a  free 
nation,  to  give  seven  millions  out  of  the  pockets  of 
innocent  people  to  increase  the  gains  of  these  rogues, 
who  have  cheated  you  of  twice  as  many  more.  Were 
I  on  the  stocks,  for  my  own  interest  I  should  not  desire 
it.  It  will  be  a  just  reason  for  those  who  are  injured 
by  it,  to  sink  the  stocks  themselves  if  ever  they  have 
a  juncture  for  it,’  1  Dr.  William  Stratford  had  written 
to  Edward  Harley  on  February  14  ;  and  on  May  2 
Edward  Harley  had  written  to  Lord  Oxford  :  4  In  the 
House  of  Commons  they  have  given  up  the  seven  millions 
belonging  to  the  public  to  the  S.S.  sufferers,  and  so 
new  schemes  are  to  be  settled  for  establishing  credit, 
which  is  sunk  into  so  deep  a  consumption  that  even 
asses  milk  it  is  thought  will  not  retrieve  it.’  2  Milner’s 
motion,  however,  in  spite  of  opposition  was  approved 
by  221  to  194  votes.  Two  days  later,  however,  William 
Yonge  3  moved  that  £5,000,000  he  remitted,  and  the 
remaining  £2,000,000  be  reserved  towards  the  liquida¬ 
tion  of  the  National  Debt.  This,  though  opposed  by 
Walpole,  was  agreed ;  but,  it  may  here  be  mentioned, 

1  Portland  MSS.,  VII.,  290. 

2  Portland  MSS.,  V.,  621. 

3  William  Yonge  (d.  1755),  M.P.  for  Honiton  ;  K.B.,  1725; 
succeeded  his  father  as  (fourth)  baronet ;  Secretary-at-War, 
1735. 


RESTORATION  OF  CREDIT 


241 


ultimately,  the  £2,000,000  was,  on  the  appeal  of  the 
stockholders,  by  subsequent  Acts,  divided  amongst 
them  in  1731  and  1732. 

By  a  resolution  of  the  House  of  Commons  a  valuation 
of  the  estates  of  the  South  Sea  Directors  had  been  taken. 
The  Committee  charged  with  this  difficult  task  made  its 
report  on  April  17,  when  it  announced  the  value  to  be 
£2,014,123,  which  was  far  less  than  was  expected. 
There  can,  indeed,  be  no  doubt  that  the  Directors  did  not 
disclose  all  their  effects.  4  We  have  been  much  baulked 
in  our  expectations  of  what  the  estates  of  the  late 
Directors  would  produce,’  Arthur  Onslow  wrote  to  the 
Hon.  John  Molesworth.  4  We  talked  very  currently  of 
eight  or  ten  millions,  but  they  come  out  to  be  only 
about  two  millions,  and  the  estates  of  the  other  criminals, 
which  we  shall  confiscate,  will  not,  I  fear,  make  above 
a  million  more  at  the  most.’ 1  As  it  was  not  the  inten¬ 
tion  of  the  Commons  to  reduce  the  Directors,  most  of 
whom  were  elderly  men,  to  absolute  penury,  the  House 
devoted  its  attention  to  deciding  what  allowances 
should  be  made.  One  member  proposed  that  an  eighth 
part  should  be  restored,  but  to  this  it  was  objected, 
that  it  would  be  too  much  for  some  who  had  the  great¬ 
est  estates  and  consequently  had  been  most  deeply 
guilty,  and  too  little  for  others  who  had  but  small 
estates,  and  were  only  passively  criminal  by  not  having 
dissented  to  the  fraudulent  management  of  the  rest. 
Eventually  each  case  was  decided  on  its  merits,  the 
grants  amounted  to  £354,600,  or  nearly  one-sixth  of  the 
estates.  The  matter  occupied  the  House  during  several 
sittings,  and  there  was  a  battle  royal  on  May  25  about 
Sir  John  Blunt.  4  The  Court  voted  against  him,  Lau¬ 
rence  Carter  moved  that  he  should  have  but  a  shilling,’ 

1  May  G,  1721  ;  MSS.  in  Various  Collections ,  VIII.,  308. 

R 


242 


THE  SOUTH  SEA  BUBBLE 


Edward  Harley,  junr.,  wrote  to  Abigail  Harley.  4  Walpole 
said  that  he  was  the  projector  of  this  baneful  scheme, 
that  his  informations  were  only  whispers  and  hearsays, 
and  that  as  he  had  been  the  chief  contriver  and  manager, 
he  should  have  the  greater  punishment.  To  this  Shippen 
said  that  he  was  no  advocate  for  Blunt,  wrho  had  been 
recommended  to  the  favour  of  the  House  by  the  Secret 
Committee  for  the  light  he  had  given  them,  but  that 
now  he  perceived  that  the  discoveries  Sir  John  had 
made  were  his  greatest  crimes,  and  therefore  he  was  to 
be  made  an  example  to  deter  the  other  Directors  from 
telling  what  they  knew.  .  .  .  After  a  long  struggle  £1,000 
was  allowed  Blunt ;  the  others  have  more.’ 1 


The  following  table  shows  the  estates  of  the  Directors, 


and  the  allowances  granted  in  each  case 

Estates.2 

Allowances. 

* 

£ 

£ 

Sir  John  Fellowes,  Bt.,  Sub-Governor  . 

243,096 

10,000 

Charles  Joye,  Deputy- Governor  . 

40,105 

5,000 

William  Astell . 

27,750 

5,000 

Sir  Lambert  Blackwell  .... 

83,529 

10,000 

Sir  John  Blunt  ....... 

183,349 

1,000 

Sir  Robert  Chaplin,  Bart . 

39,161 

10,000 

Sir  William  Chapman . 

39,161 

10,000 

Robert  Chester . 

140,372 

10,000 

Stephen  Child . 

52,437 

10,000 

Peter  Delaporte . 

17,151 

10,000 

Francis  Eyles . 

34,329 

20,000 

James  Edmondson . 

5,365 

3,000 

Edward  Gibbon . 

106,543 

10,000 

John  Gore . 

38,936 

20,000 

Sir  William  Hammond.  .... 

22,707 

10,000 

Francis  Hawes . 

40,031 

31 

Richard  Horsey . 

19,962 

10,000 

Robert  Houlditch . 

39,527 

5,000 

Sir  Theodore  Janssen,  Bart.  . 

243,244 

50,000 

1  May  30,  1721  ;  Portland  MSS.,  V.,  022. 

2  Shillings  and  pence  have  been  disregarded  in  compiling 
this  list.  The  total  amount  of  the  estates  was  £2,014,123. 


RESTORATION  OF 

CREDIT 

243 

Estates. 

Allowances. 

£ 

£ 

Sir  Jacob  Jacobsen . 

11,481 

11,000 

Arthur  Ingram . 

16,795 

12,000 

Sir  John  Lambert,  Bart.  . 

72,508 

5,000 

Sir  Harcourt  Master  .... 

11,814 

5,000 

William  Morley . 

1,869 

1,800 

Ambrose  Page . 

34,817 

10,000 

Colonel  Hugh  Raymond  . 

64,375 

30,000 

Samuel  Read,  Junr . 

.  117,297 

10,000 

Thomas  Reynolds . 

18,368 

14,000 

Jacob  Sawbridge . 

77,254 

5,000 

William  Tillard . 

19,175 

15,000 

John  Turner . 

881 

800 

Robert  Surnam,  Deputy-Cashier  . 

.  121,321 

5,000 

John  Grigsby,  Accountant 

31,687 

^  2,000! 

Diametrically  opposite  views  have  been  taken  as  to 
the  action  of  the  House  of  Commons.  4  After  all  the 
pains  that  have  been  taken  to  detect  the  villainies  of 
the  Directors  and  their  friends,’  St.  John  Brodrick2 
wrote  to  Lord  Middleton,  May  24,  1721,  4  1  am  afraid 
they  will  at  last  slip  through  their  fingers,  and  that 
nothing  further  will  be  done  as  to  confiscation,  hanging, 
etc.  There  certainly  is  a  majority  in  the  House  of 
Commons  that  are  willing  to  do  themselves  and  the 
Kingdom  justice  ;  but  they  act  so  little  in  concert 
together  that  they  are  constantly  baffled  by  a  set  of 
men  whom  guilt,  money,  etc.,  have  linked  in  the  closest 
bonds.  It  is  impossible  to  tell  you  of  what  infinite 
consequence  the  absence  of  a  friend  of  yours  3  is  at 
this  time,  and  how  uneasy  the  generality  of  mankind  is 

1  The  Directors’  estates  were  valued  at  £2,014,123,  and  the 
allowances  granted  amounted  to  £354,600,  leaving  for  the  relief 
of  the  sufferers,  £1,569,523.  To  this  sum  must  be  added  the 
amounts  taken  from  the  estates  of  Aislabie,  James  Craggs  the 
elder,  and  Caswell  and  Co. 

2  St.  John  Brodrick,  M.P.  for  Beeralston. 

3  Thomas  Brodrick,  Chairman  of  the  Committee  of  Secrecy, 
who  was  absent  owing  to  illness. 


244 


THE  SOUTH  SEA  BUBBLE 


at  it.  He  is,  without  compliment,  the  spring  that 
gives  motion  to  the  whole  body  ;  and  the  only  man  that 
can  or  will  set  matters  in  a  true  light,  and  expose  and 
baffle  the  schemes  of  the  screen,  etc.’ 1  A  very  different 
opinion  was  set  forth  more  than  forty  years  later  by 
Edward  Gibbon,  the  historian,  whose  grandfather  was 
sadly  implicated  in  the  affair,  and  of  whom  he  wrote  : 
‘  His  fortune  was  overwhelmed  in  the  shipwreck  of  the 
year  1720,  and  the  labours  of  thirty  years  were  blasted 
in  a  single  day.  Of  the  use  or  abuse  of  the  South  Sea 
scheme,  of  the  guilt  or  innocence  of  my  grandfather  and 
his  brother  directors,  I  am  neither  a  competent  nor  a 
disinterested  judge.  Yet  the  equity  of  modern  times 
must  condemn  the  violent  and  arbitrary  proceedings, 
which  would  have  disgraced  the  cause  of  justice,  and 
would  render  injustice  still  more  odious.  No  sooner 
had  the  nation  awakened  from  its  golden  dream  than 
a  popular  and  even  a  Parliamentary  clamour  demanded 
their  victims  :  but  it  was  acknowledged  on  all  sides  that 
the  South  Sea  Directors,  however  guilty,  could  not  be 
touched  by  any  of  the  laws  of  the  land.  The  speech 
of  Lord  Molesworth,  the  author  of  “  The  State  of  Den¬ 
mark,”  may  show  the  temper,  or  rather  the  intemper¬ 
ance,  of  the  House  of  Commons.  “  Extraordinary 
crimes  ”  (exclaimed  the  ardent  Whig)  “  call  aloud  for 
extraordinary  remedies.  The  Roman  lawgivers  had 
not  foreseen  the  possible  existence  of  a  parricide  :  but 
as  soon  as  the  first  monster  appeared  he  was  sewn  into 
a  sack,  and  cast  headlong  into  the  river  ;  and  I  shall 
be  content  to  inflict  the  same  treatment  on  the  authors 
of  our  present  ruin.” 1  2  His  motion  was  not  literally 

1  Middleton  Papers,  quoted  in  Coxe’s  Memoirs  of  Sir  Robert 
Walpole,  II.,  216. 

2  See  ante. 


RESTORATION  OF  CREDIT 


245 


adopted  ;  but  a  bill  of  pain  and  penalties  was  introduced, 
a  retroactive  statute,  to  punish  the  offences,  which  did 
not  exist  at  the  time  they  were  committed.  Such  a 
pernicious  violation  of  liberty  and  law  can  be  excused 
only  by  the  most  imperious  necessity  ;  nor  could  it 
be  defended  on  this  occasion  by  the  plea  of  impending 
danger  or  useful  example.  The  Legislation  restrained 
the  persons  of  the  Directors,  imposed  an  exorbitant 
security  for  their  appearance,  and  marked  their  char¬ 
acters  with  a  previous  note  of  ignominy  :  they  were 
compelled  to  deliver,  upon  oath,  the  strict  value  of  their 
estates  ;  and  were  disabled  from  making  any  transfer 
or  alienation  of  any  part  of  their  property.  Against 
a  bill  of  pains  and  penalties  it  is  the  common  right  of 
every  subject  to  be  heard  by  his  counsel  at  the  bar : 
they  prayed  to  be  heard  ;  their  prayer  was  refused, 
and  their  oppressors,  who  required  no  evidence,  would 
listen  to  no  defence.  It  had  been  at  first  proposed  that 
one-eighth  of  their  respective  estates  should  be  allowed 
for  the  future  support  of  the  Directors  ;  but  it  was 
speciously  urged,  that  in  the  various  shades  of  opulence 
and  guilt  such  a  proportion  would  be  too  light  for 
many,  and  for  some  might  possibly  be  too  heavy.  The 
character  and  conduct  of  each  man  were  separately 
weighed ;  but,  instead  of  the  calm  solemnity  of  a 
judicial  enquiry,  the  fortune  and  honour  of  three- and- 
thirty [Englishmen  were  made  the  topic  of  hasty  conver¬ 
sation,  the  sport  of  a  lawless  majority  ;  and  the  basest 
member  of  the  Committee,  by  a  malicious  word  or  a 
silent  vote,  might  indulge  his  general  spleen  and  per¬ 
sonal  animosity.  Injury  was  aggravated  by  insult, 
and  insult  was  embittered  by  pleasantry.  Allowances 
of  twenty  pounds,  or  one  shilling,  were  facetiously 
moved.  A  vague  report  that  a  Director  had  formerly 


246 


THE  SOUTH  SEA  BUBBLE 


been  concerned  in  another  project,  by  which  some 
unknown  persons  had  lost  their  money,  was  admitted 
as  a  proof  of  his  actual  guilt.  One  man  was  ruined 
because  he  had  dropped  a  foolish  speech,  that  his  horses 
should  feed  upon  gold  ;  another  because  he  was  grown 
so  proud  that,  one  day  at  the  Treasury,  he  had  refused 
a  civil  answer  to  persons  much  above  him.  All  were 
condemned,  absent  and  unheard,  in  arbitrary  fines  and 
forfeitures,  which  swept  away  the  greatest  part  of  their 
substance.’ 1 

Into  the  further  question  which  Gibbon  raised, 
whether  the  parliament  then  sitting  was  the  true  and 
legal  representative  of  the  country  because  it  derived 
from  itself,  and  not  from  the  people,  the  right  to  extend 
its  life  from  three  to  seven  years,  is  an  academic  problem 
which  need  not  here  be  discussed.2  Nor,  indeed,  would 
it  be  necessary  to  examine  the  other  statements,  did 
they  not  emanate  from  a  person  so  famous  as  the  author 
of  4  The  Decline  and  Fall  of  the  Roman  Empire.’  It 
was  natural  that  Gibbon  should  feel  strongly  on  the 
subject,  but  few  will  be  deceived  by  his  special  pleading. 
It  may  at  once  be  admitted  that  throughout  the  country 
there  was  a  clamour  for  the  punishment  of  the  offenders, 
but  this  in  itself  was  not  reprehensible  ;  and  it  is  not 
to  be  denied  that  a  special  Act  was  passed  for  that 
purpose.  Further,  it  is  true  that  one  member  com¬ 
plained  of  the  insolence  of  Blunt,  and  another  avowed 
that  this  Director  had  been  concerned  with  another 
4  bubble  ’  company  ;  and  that  a  third,  stating  that  the 
Company’s  Accountant  had  declared  he  would  feed  his 
horses  with  gold,  humorously  moved  that  the  culprit 

1  Edward  Gibbon  the  elder  survived  until  1736,  when  he 
had  realised  another  very  considerable  fortune. 

2  The  Septennial  Act  was  passed  in  1716. 


RESTORATION  OF  CREDIT 


247 


should  be  allowed  as  much  gold  as  he  could  eat,  and 
that  the  rest  of  his  estate  should  go  towards  the  relief 
of  the  sufferers.  All  these  things  are  trifles.  Gibbon, 
however,  as  has  already  been  shown,  makes  a  serious 
misstatement  when  he  says  that  the  Directors  were 
condemned,  absent  and  unheard.  On  their  trial,  they 
were  examined,  cross-examined,  and  permitted  to  put 
forward  their  defence.  Only  when  they  were  found 
guilty  and  the  question  of  their  punishment  was  being 
discussed  were  they  4  absent  and  unheard,’  it  not  being 
the  custom  to  invite  the  criminal  to  assist  in  deciding 
the  penalties  that  shall  be  inflicted  upon  him.  The 
one  important  point — and  to  that  Gibbon  scarcely 
alludes — is  that  the  Directors  were  guilty.  The  other 
is  that  the  punishment  meted  out  to  them  was  singularly 
light :  instead  of  being  awarded  a  long  term  of  impiison- 
ment,  only  heavy  fines  (the  greater  part  of  which  was 
paid  out  of  the  illicit  gains)  were  inflicted.  A  study 
of  the  list  of  allowances  shows  very  clearly  that  while 
the  Commons  were  aware  that  by  law  all  the  Directors 
were  equally  responsible,  they  realised  that  they  were 
not  all  equally  culpable,  and  differentiated  between 
them  accordingly.  Apparently  they  deemed  Delaporte, 
Eyles,  Gore,  Horsey,  Ingram,  Morley,  Reynolds,  Tillard, 
and  Turner  guilty  at  worst  of  carelessness  ;  and  since 
they  allowed  Janssen  to  retain  £50,000,  or  twenty 
per  cent,  of  his  fortune,  and  Raymond  £30,000,  or 
fifty  per  cent,  of  his,  they  clearly  did  not  rank  them 
among  the  worst  offenders.  Fellowes,  Lambert,  Saw- 
bridge,  and  the  two  officers  of  the  Company  were  in 
their  eyes  very  guilty  ;  and  so  was  Gibbon,  who,  having 
had  business  experience  at  home  and  abroad  and  having 
been  for  four  years  a  Commissioner  of  Customs,  could 
certainly  not  plead  that  he  had  erred  through  ignorance 


248 


THE  SOUTH  SEA  BUBBLE 


of  affairs.  What  they  thought  of  Blunt  may  be  deduced 
from  the  fact  that  when  on  April  24  he  sent  a  petition 
in  which  he  declared  his  innocence,  it  ‘rather  moved 
the  laughter  than  the  compassion  of  the  House  5  1 :  they 
contemptuously  flung  him  £1,000.  It  is  obvious  that 
they  regarded  Hawes,  not  only  as  a  prime  mover  in  the 
swindle,  but  also  as  especially  unscrupulous,  since, 
with  something  of  cynicism,  perhaps  not  ill-befitting 
the  occasion,  they  allowed  him  to  retain  the  odd  £31 
of  an  estate  valued  at  £40,031. 

There  was  great  jubilation  in  many  circles  that  after 
all  the  Directors  and  their  associates  had  not  entirely 
managed  to  evade  punishment  for  their  misdoings,  and 
there  was  a  certain  malicious  and  very  natural  delight 
that  some  of  those  who,  for  their  own  ends,  had  ruined 
so  many  families,  were  themselves  reduced  to  penury. 

THE  JAIL-BIRD. 

Behold  a  poor  dejected  wretch, 

Who  kept  a  S.-Sea  coach  of  late, 

But  now  is  glad  to  humbly  catch 
A  penny  at  the  prison  gate. 

’Tis  strange  one  set  of  knaves  should  sour 
A  nation  fam’d  for  wealth  and  wit, 

But  stranger  still  that  men  in  power 
Should  give  a  sanction  to  the  cheat. 

What  ruin’d  numbers  daily  mourn 

Their  groundless  hopes  and  follies  past, 

Yet  see  not  how  the  tables  turn 
Or  where  their  money  flies  at  last. 

Fools  lost  when  the  Directors  won  ; 

But  now  the  poor  Directors  loose, 

And  where  the  S.-Sea  stock  will  run 
Old  Nick,  the  first  projector,  knows. 


1  Political  State  of  Great  Britain ,  XXI.,  443. 


RESTORATION  OF  CREDIT 


249 


The  South  Sea  Sufferers’  Bill 1 * *  passed  the  Lords  on 
July  25,  and  received  the  Royal  Assent  four  days  later, 
when  Parliament  was  prorogued.  On  July  31,  however, 
a  special  session  was  inaugurated  for  the  4 * * 7  sole  purpose 
of  resuming  the  consideration  of  the  state  of  public 
credit.’  4  The  progress  which  you  have  made  in  this 
affair  during  the  last  session  laid  such  a  foundation  of 
this  necessary  work,  that  the  world  is  fully  apprised 
of  what  is  reasonably  to  be  hoped  for  at  the  present 
conjuncture,’  the  King  said  to  the  Commons ;  and, 
addressing  both  Houses,  added,  4 1  must  recommend  to 
you  all  possible  dispatch,  and  am  persuaded  at  this 
season  of  the  year  your  deliberation  will  be  confined 
to  what  is  absolutely  necessary  upon  this  extraordinary 
occasion.’  On  the  same  day  the  Commons  passed  the 
following  Resolutions  : — 

‘  1.  That  for  the  re-establishment  of  public  credit, 
relief  be  given  to  the  South  Sea  Company  with  regard 
to  the  payment  of  £4,156,306-4-11  and  the  four  and  a 
half  years’  purchase,  and  one  year’s  purchase,  upon 
several  annuities  and  other  national  debts,  the  said 
Company  giving  such  consideration  to  the  public,  and 
such  further  relief  to  the  several  proprietors  and 
persons  concerned  in  interest  with  the  said  Company, 
as  this  House  shall  think  proper. 

1  An  Act  for  raising  money  upon  the  estates  of  the  late 

Sub- Governor,  Deputy- Governor,  Directors,  Cashier,  Deputy- 
Cashier,  and  Accountant  of  the  South  Sea  Company,  and  of 
John  Aislabie,  Esq.,  and  likewise  of  James  Craggs,  senior,  Esq., 
deceased,  towards  making  good  the  great  loss  and  damage 

sustained  by  the  said  Company  ;  and  for  disabling  such  of  the 

said  persons  as  are  living  to  hold  any  office  or  place  of  trust 

under  the  Crown,  or  to  sit  or  vote  in  Parliament  for  the 

future  ;  and  for  other  purposes  in  the  said  Act  expressed. — 

7  Geo.  I.,  c.  2,  8. 


250 


THE  SOUTH  SEA  BUBBLE 


4  2.  That  for  the  re-establishing  of  the  public  credit, 
and  quieting  the  minds  of  his  Majesty’s  subjects,  the 
several  properties  and  interests  now  depending,  and 
concerned  with  the  South  Sea  Company  be  ascertained 
and  settled. 

4  3.  That  in  order  to  put  an  end  to  all  disputes  between 
the  South  Sea  Company  and  the  proprietors  of  the 
redeemable  funds  subscribed  into  the  said  Company, 
and  for  the  further  relief  of  the  said  proprietors,  and 
the  proprietors  of  the  Second,  Third,  and  Fourth  Money- 
Subscriptions,  who  have  now  stock  allowed  them  at 
the  rate  of  £400  per  cent.,  with  the  last  Midsummer 
dividend  of  ten  per  cent,  in  stock,  in  addition  after  the 
rate  of  £35-6-8  stock  upon  every  £100  stock  already 
allowed,  be  given  by  the  South  Sea  Company  to  the 
proprietors  of  the  said  redeemable  funds,  and  to  the 
proprietors  of  the  Second,  Third,  and  Fourth  Money- 
Subscriptions. 

4  4.  That  the  sum  of  £4,156,341  with  the  four  years 
and  a  half  year’s  and  the  one  year’s  purchase,  payable 
to  the  public  by  the  South  Sea  Company  be  remitted, 
so  as  from  June  24,  1722,  £2,000,000  of  the  capital 
stock  of  the  said  Company  be  reduced  and  annihilated, 
and  a  proportionable  part  of  their  annuity  or  yearly 
fund,  in  respect  of  the  said  £2,000,000  from  that  time 
cease. 

4  5.  That  the  Second  Subscription  of  the  irredeem¬ 
ables,  as  well  the  Long  Annuities  as  the  Nine-per-cent., 
Prize  Lottery  Tickets,  and  Blank  Lottery  Tickets,  be 
made  equal  to  the  First  Subscription  of  the  like  annuities 
and  tickets,  by  an  addition  of  stock  at  £150  per  cent. 

4  6.  That  all  the  capital  South  Sea  stock  belonging 
to  the  Company  in  their  own  right,  which,  after  the 
proposed  disposition  made,  shall  remain  undisposed  of, 


RESTORATION  OF  CREDIT 


251 


be  divided  among  all  the  proprietors  of  the  said  Com¬ 
pany,  in  proportion  to  their  several  and  respective 
interests  therein,  and  that  credit  be  given  them  for  the 
same  in  the  books  of  the  said  Company. 

4  7.  That  such  persons  as  have  borrowed  money  from 
the  South  Sea  Company  upon  South  Sea  stock,  actually 
transferred  and  pledged  at  the  time  of  borrowing,  to 
or  for  the  use  of  the  South  Sea  Company,  shall,  upon 
payment  of  ten  per  cent,  upon  the  respective  sums  so 
borrowed,  at  a  time  or  times  to  be  limited,  and  not 
otherwise,  be  discharged  from  all  further  demands  of 
the  said  Company  in  respect  of  the  monies  so  borrowed  ; 
and  that  all  the  stock  so  transferred  and  pledged,  to¬ 
gether  with  all  dividends  and  profits  thereto  belonging 
respectively  be  absolutely  vested  in  the  said  Company. 

4  8.  That  such  persons  as  have  borrowed  money 
from  the  South  Sea  Company  upon  subscription  receipts 
actually  pledged  to  the  said  Company  at  the  time  of 
borrowing,  shall,  upon  payment  of  ten  per  cent,  upon 
the  respective  sums  so  borrowed,  at  a  time  or  times  to 
,  be  limited,  and  not  otherwise,  be  discharged  all  further 
demands  in  respect  of  the  monies  so  borrowed ;  and 
that  all  the  subscription  receipts  so  pledged,  together 
with  all  dividends  and  profits  thereunto  belonging,  be 
absolutely  vested  in  the  said  Company. 

4  9.  That  all  contracts  for  the  sale  or  purchase  of 
subscriptions  or  stock  of  the  South  Sea  Company  or  any 
other  company  or  corporation,  or  pretended  company 
or  corporation,  which  shall  be  unperformed,  or  not 
compounded  on  or  before  September  29  next,  be  entered 
in  books  to  be  kept  for  that  purpose,  by  the  respective 
companies  or  corporations  before  November  1  next, 
or  else  to  be  void ;  and  that  such  entries  shall  express 
for  whose  use  and  benefit  such  contracts  were  made, 


252 


THE  SOUTH  SEA  BUBBLE 


4 10.  That  no  special  bail  be  required  in  any  action 
brought,  or  to  be  brought,  upon  any  contract  made 
since  December  1,  1719,  and  before  December  1,  1720, 
for  the  sale  or  purchase  of  any  subscription  or  stock  of 
the  South  Sea  Company,  or  any  other  company  or  cor¬ 
poration,  or  pretended  company  or  corporation. 

4 11.  That  no  execution  be  awarded  upon  any  judg¬ 
ment  obtained,  or  to  be  obtained,  in  any  action  brought, 
or  to  be  brought,  upon  any  contract  for  the  sale  or 
purchase  of  any  subscription  or  stock  of  the  South  Sea 
Company,  or  any  other  company  or  corporation,  or 
pretended  company  or  corporation,  until  the  end  of  the 
session  of  Parliament,  which  shall  be  next  after  Sep¬ 
tember  29  next. 

4 12.  That  all  the  contracts  for  the  sale  or  purchase 
of  any  subscription  or  stock  of  the  South  Sea  Company, 
or  any  other  company  or  corporation,  which  shall  be 
unperformed  or  not  compounded,  on  or  before  September 
29  next,  where  the  seller,  or  the  person  on  whose  behalf 
such  contract  was  made,  was  not  at  the  time  of  such 
contract,  or  within  a  time  to  be  limited,  actually  pos¬ 
sessed  of  or  entitled  to  such  subscription  or  stock,  shall 
be  declared  null  and  void.5 

On  the  next  day  (August  1),  William  Loundes  1 
brought  in,  based  upon  these  resolutions,  a  4  Bill  for 
making  several  provisions  to  restore  the  public  credit, 
which  suffers  by  the  frauds  and  mismanagements  of  the 
late  Directors  of  the  South  Sea  Company  and  others,’ 
and  it  was  read  a  first  time.  There  was  a  disposition 
in  some  quarters  to  oppose  the  Bill,  and  amongst  those 
who  objected  to  it  were  many  of  the  proprietors  of  the 
public  debts  who  had  subscribed  their  annuities  for 

1  William  Loundes  (1652-1724),  M.P.  for  St.  Mawes,  Secre¬ 
tary  to  the  Treasury. 


RESTORATION  OF  CREDIT 


253 


South  Sea  stock.  These  drew  up  a  petition,  which  was 
presented  to  the  Commons,  and  supported  by  Sir  John 
Ward  and  Sir  Gilbert  Heathcote,  who  spoke  in  support 
of  it ;  but  Walpole  declined  to  consider  it,  declaring 
that  he  did  not  see  how  the  petitioners  could  be  relieved, 
since  the  Resolutions  on  which  the  Bill  was  founded 
had  been  approved  by  the  King  and  Council,  and  had 
been  agreed  to  by  a  great  majority  of  the  House,  and 
that,  further,  they  had  given  their  word  of  honour  to 
the  members  who  had  gone  into  the  country  that  they 
would  not  alter  a  tittle  in  them.  The  Bill  was  then 
read  a  second  time  and  committed.  Several  hundred 
subscribers  had  gathered  in  the  lobby  and  within  the 
precincts  of  the  House,  crying  that  they  were  being 
unfairly  treated,  and  distributing  papers  bearing  the 
words  :  4  Pray  do  justice  to  the  annuitants  who  lent 
their  money  on  Parliamentary  security.’  So  great  was 
the  tumult  that,  the  attendants  reporting  themselves 
powerless,  the  Speaker  commanded  the  attendance  of 
the  Justices  of  the  Peace  for  the  City  of  Westminster 
and  of  the  constables.  Not  until  the  magistrates  had 
twice  read  the  Riot  Act  could  the  unruly  crowd  be 
persuaded  to  disperse.  The  Bill  was  read  a  third  time 
on  August  4,  and  six  days  later  it  passed  the  Lords  and 
received  the  Royal  Assent.  Parliament  was  prorogued 
immediately.  4  The  common  calamity,  occasioned  by 
the  wicked  execution  of  the  South  Sea  scheme,’  so  ran 
a  passage  in  the  Speech  from  the  Throne,  4  was  become 
so  very  great  before  your  meeting,  that  the  providing 
proper  remedies  for  it  was  very  difficult ;  but  it  is  a 
great  comfort  to  me  to  observe  that  public  credit  now 
begins  to  recover  ;  which  gives  me  the  greatest  hopes 
that  it  will  be  entirely  restored  when  all  the  provisions 
you  have  made  for  that  end  shall  be  duly  put  in  execu- 


254 


THE  SOUTH  SEA  BUBBLE 


tion.  I  have  great  compassion  for  the  suffering  of  the 
innocent,  and  a  just  indignation  against  the  guilty ; 
and  have  readily  given  my  assent  to  such  Bills  as  you 
have  presented  to  me  for  punishing  the  authors  of  our 
late  misfortunes,  and  for  obtaining  the  restitution  and 
satisfaction  due  to  those  who  have  been  injured  by  them, 
in  such  manner  as  you  judged  proper.  I  was,  at  the 
same  time,  willing  and  desirous,  by  my  free  and  general 
pardon,  to  give  ease  and  quiet  to  the  rest  of  my  subjects, 
many  of  whom  may,  in  such  a  general  infatuation, 
have  been  unwarily  drawn  in  to  transgress  the  laws.’ 


r 


L’ENVOI 


WITH  the  punishment  of  the  Directors  and  their 
associates,  and  the  enacting  of  measures  to 
restore  the  public  credit,  the  history  of  the  South  Sea 
Bubble  comes  to  an  end.  It  has  been  suggested  that 
Lord  Sunderland  willingly  fell  in  with  the  general  wish 
that  Walpole  should  take  charge  of  the  proceedings  in 
connection  with  the  Company,  feeling  sure  that  he  must 
fail,  and  that  such  failure  would  transfer  to  the  Pay¬ 
master  the  odium  attaching  to  the  Ministry  1 ;  but, 
whether  this  was  so  or  not,  Walpole  carried  the  business 
through  with  great  success.  This  is  not  to  say,  however, 
that  every  one  was  satisfied  with  the  result.  Many 
thought  the  Directors  were  treated  too  leniently,  and 
others  were  convinced  that  insufficient  relief  had  been 
given  to  the  sufferers.  As,  however,  nothing  short  of 
hanging  the  Directors  would  have  pleased  the  one  party, 
and  nothing  less  than  the  replacing  all  the  money  lost 
in  the  venture  would  have  pleased  the  other,  and  as 
these  courses  obviously  did  not  come  within  the  realm 
of  practical  politics,  Walpole  devoted  all  his  skill,  his 
energy,  and  his  perseverance  in  the  attempt  to  discover 
the  happy  mean.  Impartial  observers  to-day  will 
probably  agree  that,  take  it  for  all  in  all,  he  did  the  best 
that  could  be  effected  in  the  true  interests  of  the  country. 

1  See  John  Lord  Hervey  :  Memoirs  (ed.  1884),  I.,  43. 

255 


256 


THE  SOUTH  SEA  BUBBLE 


The  South  Sea  Company  survived  for  many  decades 
after  the  catastrophe  which  threatened  its  very  existence. 
Its  efforts  to  establish  itself  as  a  trading  company 
were,  however,  singularly  unfortunate.  For  the  Green¬ 
land  Whale  Fishery  fitted  out  in  1728  twenty-three 
ships,  which  returned  with  only  the  blubber  and  fins 
of  eighteen  whales.  Four  years  later  a  fleet  of  twenty- 
one  ships  brought  back  twenty-four  whales,  and  this, 
like  the  earlier  expedition  was,  as  the  chronicler  put  it, 
4  undoubtedly  a  losing  voyage.’  From  1724  to  1732 
its  expenditure  on  the  fishery  was  £262,390,  its  receipt 
from  this  source  during  the  same  period,  £84,390  ;  so 
that  its  loss,  exclusive  of  interest  on  the  money  invested 
in  the  trade  during  the  eight  years  was  no  less  than 
£177,782.  It  decided,  therefore,  to  retire  from  this 
business,  which,  however,  it  must  be  added,  other 
adventurers  found  profitable. 

Nor  was  the  Company  more  successful  in  other  direc¬ 
tions.  It  declared  that  in  1734  during  the  last  ten 
years  its  assiento  trade  had  resulted  only  in  an  aver¬ 
age  profit  of  £3,226,  which  was  quite  out  of  all  proportion 
to  the  capital  invested  and  the  ordinary  risks  under¬ 
taken.  Its  trading  with  America  was  no  whit  more 
satisfactory.  Its  ships  were,  on  one  pretext  or  another, 
held  up  by  the  Spanish  Government,  and  it  had  great 
trouble  with  its  agents,  who  indulged  largely  and  to 
their  exceeding  profit,  in  clandestine  trade,  to  the 
detriment  of  their  employers.  In  1730  the  Prince 
Frederick  arrived  in  the  Thames  with  400,000  dollars 
or  pieces  of  eight,  in  specie,  190,000  lb.  of  cochineal, 
47,000  lb.  of  indigo,  and  167  tons  of  logwood.  The 
cargo  was  valued  at  £350,000,  but  the  profit  on  the 
venture  was  swallowed  up  by  the  heavy  expenses 
incidental  upon  the  long  detention  of  the  ship  at  Vera 


L’ENVOI 


257 


Cruz  and  by  the  malversation  of  the  Company’s  super¬ 
cargoes  and  factors.  In  the  same  year  it  loaded  the 
Royal  Caroline  with  a  very  rich  cargo  for  the  fair  of 
Porto-Bello,  but  the  Spanish  Court  delayed  to  send  the 
licence  until  its  own  galleons  had  sailed  from  Cadiz. 
The  Royal  Caroline  did  eventually  sail,  but  on  its  return 
it  was  detained  at  Vera  Cruz.  It,  too,  brought  back, 
in  1733,  a  cargo  of  pieces  of  eight,  cochineal,  and  indigo, 
and  it  made  a  profit  of  £70,000,  almost  the  only  profit¬ 
able  venture  of  the  Company.  This  was  the  last  annua] 
ship  sent  out.  The  Company  sought  permission  to 
obtain  certain  terms  from  the  Spanish  Government  for 
the  surrender  of  its  privileges.  The  matter,  however, 
was  not  definitely  arranged  until  1748,  within  five  years 
of  the  lapsing  of  the  arrangement  made  in  1713  for  a 
period  of  forty  years.  The  South  Sea  Company  then 
ceased  to  be  a  trading  body,  and  eventually  its  remain¬ 
ing  stock  was  converted  into  annuity  stock. 


s 


INDEX 


Acton,  Francis,  9 
Aislabie,  John,  24,  24  note  1, 
35,  37,  38,  39,  97,  189,  194, 
199,  203,  210,  222-228,  229, 
243  note  1,  249  note  1 
Alberoni,  Cardinal,  28 
Anne,  Queen,  17 
Antrim,  Samuel,  107 
Argyle,  John  Campbell,  second 
Duke  of,  21,  21  note  3,  157 
Astell,  William,  9,  21,27,135, 
204,  242 

Atterbury,  Francis,  Bishop  of 
Rochester,  130,  159,  161 
Ayles,  Thomas,  211  note  3 

Barber,  John,  55,  55  note  1 
Bateman,  Sir  James,  7,  7 
note  1,  21 

Bathurst, Allen  Bathurst,  Earl, 
115,  115  note 

Beck,  Sir  Justus,  bart.,  157, 
157  note  3 

Beechcroft,  Sir  Robert,  7 
Benson,  Robert,  7,  7  note  3 
Berkeley  of  Stratton,  Lord, 
156,  166,  166  note  3 
Bernstorff,  Count,  162 
Blackwell,  Sir  Lambton,  21, 
21  note  4,  27,  242 
Blunt,  Charles,  7,  9 
Blunt,  Sir  John,  7,  7  note  4, 
21,  27,  31,  34,  57,  112,  206, 


207,  212,  220,  221,  232, 
233,  241,  242,  247 
Bolingbroke,  Henry  St.  John, 
Viscount,  8,8  note  7,  17,  18, 
21 

Bolton,  Charles  Paulet,  second 
Duke  of,  157,  157  note  7 
Boscawen,  Hugh.  See  Fal¬ 
mouth,  Viscount 
Boyd,  Thomas,  107 
Bridgewater,  Scroop  Egerton, 
first  Duke  of,  76,  76  note  1 
Brodrick,  Arthur,  37,  37  note 
1,  40,  42,  130,  223 
Brodrick,  St.  John,  243,  243 
note  2 

Brodrick,  Thomas,  120,  122, 
175,  184,  190,  192,  210,  221, 
222,  233,  243  note  3 
Brook,  William,  211  note  3 
Budgell,  Eustace,  127,  127 
note  1,  130,  134 
Bulstrode,  Whitelocke,  139, 
139  note  2 

Burges,  Thomas,  107 

Cam,  Sir  Alex,  110 
Campbell,  Colonel,  152,  152 
note  1 

Carleton,  A.,  10 
Carlisle,  Lord,  140,  141,  158, 
163,  168,  187,  189,  190,  192, 
198,  237,  238 


260 


INDEX 


Caswell,  Sir  George,  7,  7  note 
5,  21,  26,  38,  199,  211,  224, 
228-229,  243  note  1 
Chandos,  James  Brydes,  first 
Duke  of,  54,  76 
Chaplin,  Sir  Robert,  bart.,  27, 
27  note  3, 176  note  2, 199,  242 
Chapman,  Sir  William,  9,  21, 
204,  242 

Chester,  Robert,  21,  27,  123, 
129,  135,  204,  212,  242 
Chesterfield,  Lady,  213  note  1 
Chesterfield,  Philip  Stanhope, 
third  Earl  of,  218 
Chetwood,  William  Rufus,  78 
Chetwynd,  Walter  Chetwynd, 
first  Viscount,  97,  97  note  1, 
158 

Child,  Stephen,  27,  218  note 
1,  242 

Clarke,  Sir  Samuel,  7,  7  note 
7,  211  note  3 

Clayton,  Christopher,  211  note 
4 

Clayton,  Sir  William,  bart., 
190,  190  note  6,  229 
Compton,  Hon.  Spencer.  See 
Wilmington,  Earl  of,  25 
Cowper,  Lady,  97 
Cowper,  Spencer,  175 
Cowper,  William  Cowper,  first 
Earl,  49,  49  note  1,  194 
Craggs,  James,  the  elder, 
123,  126,  127,  133,  210, 
213,  235-236,  243  note  1, 
247  note  1 

Craggs,  James,  the  younger, 
37,  105,  122,  123,  185,  188, 
216,  216  note  1,  218 
Crawley,  Sir  Ambrose,  7,  8,  21 
Cross,  Sir  Thomas,  211  note  3 

Dalkeith,  Francis  Scott,  Earl 
of,  55,  55  note  7 


Darlington,  Countess  of.  See 
Platen,  Countess  of 
Dawson,  Mr.,  125 
De  Cotz,  211  note  3 
Deaele,  John,  7,  7  note  8,  9 
Decker,  Sir  Matthew,  bart.,  7, 
7  note  10,  9,  16,  126,  152 
Decoster  [?  Abraham  (or  John) 
Mendes  da  Costa],  20,  20 
note  1 

Defoe,  Daniel,  12,  13,  14 
Delaporte,  Peter,  21,  27,  242, 
247 

Define,  Sir  Peter,  123,  123 
note  3 
Deodil,  20 

Desbouverie,  Sir  Christopher, 
7,  7  note  6 

Dillon,  General  Arthur,  160, 
160  note  1 

Doliffe,  Sir  James,  7,  7  note  9, 

21,  22 

Douglas,  Archibald  Douglas, 
first  Duke  of,  55,  55  note  6 
Drummond,  — ,  167 
Durley,  Henry,  8,  8  note  1,  21 

Edmondson,  James,  27,  27 
note  4,  69,  200,  242 
Eyles,  Francis,  21,  27,  125, 
176  note  2,  199,  211  note  3, 
242,  247 

Falmouth,  Hugh  Boscawen, 
Viscount,  26 

Fellowes,  Sir  John,  bart.,  8,  21, 
27,  118,  123,  125,  133,  199, 
212,  242,  247 
Fortescue,  Judge,  226 
Frederick,  Thomas,  211  note  3 

* 

Galends,  Joseph,  108 

Gay,'  John,  218 

Gearing,  Thomas,  211  note  3 


INDEX 


261 


George  I,  26,  27,  162,  163 
Gerardot  dc  Tillieux,  J.,  211 
note  3 

Gibbon,  Edward,  21,  21  note 
5,  27,  204,  212,  242,  244, 
246  note  1,  247 
Gibbon,  Edward  (the  his¬ 
torian),  244 

Gould,  Sir  Nathaniel,  123, 
123  note  4 

Gore,  John,  8,  9,  21,  27,  123, 
242,  247 

Grigsby,  John,  199,  243 
Guiscard,  Marquis  of,  2 
Gullingham,  Manuel  Manures, 
16,  18 


Halsey,  Edward,  211  note  3 
Hamilton,  Sir  David,  152,  152 
note  2 

Hammond,  Sir  William,  9,  22, 
27,  242 

Hangar  (Governor  of  the  Bank 
of  England),  123 
Hanmer,  Sir  Thomas,  bart., 
233,  233  note  3 
Harcourt,  Lord,  156, 157  note  1 
Harley,  Lord,  120,  137,  177, 
185,  211 

Harley,  Abigail,  45,  45  note  1, 
54,  200,  242 

Harley,  Edward,  2,  2  note , 
8,  14,  43,  52,  62,  64,  156, 
191,  192,  198,  210,  240 
Harley,  Edward,  Jr.  (after¬ 
wards  second  Earl  of  Ox¬ 
ford),  44,  54,  139,  140,  152, 
153,  156,  159,  200,  242 
Harley,  Robert.  See  Oxford, 
Robert  Harley,  Earl  of 
Harley,  Thomas,  62,  69,  99, 
176,  177,  185 

Hawes,  Francis,  21,  21  note  6, 


27,  200,  204,  205,  224, 

227,  242,  247 
Hayes,  Daniel,  21 
Hayne,  Christopher,  211  note  3 
Heathcote,  Sir  Gilbert,  253 
Heathcote,  Sir  John,  123,  123 
note  2,  124 
Hill,  Aaron,  83,  90 
Hincliinbrook,  Lord,  198 
Hoare,  Sir  Richard,  8 
Hogarth,  William,  142 
Hopkins,  Richard,  211  note  3 
Horsey,  Richard,  21,  27,  242, 
247 

Houlditch,  Robert,  9,  9  note  1, 
21,  27,  200,  204,  242 
Howard,  Henrietta,  Countess 
of  Suffolk,  66,  66  note  1,  67, 
151,  151  note  1 
Hudson,  Roger,  211  note  3 
Hungerford,  John,  23,  23  note 
2,  24,  125 

Hutcheson,  Archibald,  37,  37 
note  1,  113,  191,  200 

Ingram,  Arthur,  27,  27  note 
5,  135,  200,  243,  247 
Irvine,  Lady,  140,  140  note  2, 
141,  158,  168 

Irvine,  Lord,  158,  158  note  3 
Islay,  Archibald  Campbell, 
Earl  of,  136,  136  note  1 

Jacobsen,  Sir  Jacob,  22,  22 
note  1,  27,  243 
Jacombe,  Robert,  164,  177 
James,  George,  88 
Janssen,  Sir  Theodore,  bart; 
8,  8  note  2,  21,  27,  123,  176, 
176  note  2,  199,  242,  247 
Jeffreys,  Edward,  191,  191 
note  1 

Jekyll,  Sir  Joseph,  38,  38  note 


262 


INDEX 


4,  173,  175,  190,  191,  200, 
225,  233 

Johnson,  Captain,  19,  20 
Johnson,  Dr.  Samuel,  218 
Jones,  Edward,  108 
Jones,  Jezreel,  84,  84  note  1 
Jones,  Captain  Samuel,  211 
note  3 

Joye,  Charles,  22,  27,  123, 
204,  242 

Keene,  Edmund,  211  note  3 
Kendal,  Duchess  of,  27,  27 
note  2,  203,  213,  217,  239 
Kinnoull,  Abigail,  Countess 
of,  55,  55  note  4 
Knight,  John,  140,  140  note  4, 
193,  195,  197,  198,  199,  200, 
201,  202,  203,  204,  210, 
211  note  3,  214,  220,  221, 
228,  231,  232 

Lade,  John,  211  note  3 
Lamb,  Charles,  9 
Lambert,  Sir  John,  bart.,  8, 
88,  107,  199,  243,  247 
Lane,  Matthew,  221  note  3 
Law,  John,  32,  55-56,  62-64 
Lawton,  Charlwood,  55,  55 
note  5 

Le  Bas,  Charles,  211  note  3 
Le  Neve,  Peter,  139, 139  note  2 
Lechmere,  Lady  Elizabeth, 
190,  190  note  1,  191,  198 
Lechmere,  Sir  Nicholas,  38, 
38  note  3,  39,  139,  139  note 

5,  140,  152,  191 
Lethuilier,  Benjamin,  211  note 

3 

Lewis,  Erasmus,  44,  44  note  2, 
58,  139 

Lippe,  Countess  von,  213  note 

1 


Lloyd,  John,  211  note  3 
Londonderry,  Thomas  Pitt, 
Earl  of,  158,  158  note  1 
Lonsdale,  Henry  Lowther, 
third  Earl  of,  158, 158  note 2 
Louis  XIV,  32-33 
Loundes,  William,  252,  252 
note  1 

Lovell,  Henry,  211  note  3 
Lowther,  Sir  James,  bart., 
187,  187  note  1 


Macphaedris,  Captain,  108 
Maggot,  Captain,  135 
Manningham,  Sir  Richard,  84, 
84  note  1 

Martin,  Sir  Joseph,  8,  8  note  4 
Master,  Sir  Harcourt,  8,  8 
note  5,  21,  27,  135,  200,  204, 
243 

Mendes  da  Costa,  Abraham 
or  John.  See  Decoster 
Metcalfe,  James,  211  note  3 
Methuen,  Paul,  160  note  2,  209, 
209  note  1 

Micklethwaite,  Nathaniel,  211 
note  3 

Middleton,  Lord,  120,  130, 
175,  184,  192,  221,  223 
Milner,  James,  173,  173  note  2, 
240 

Mitchell,  Robert,  211  note  3 
Molesworth,  Mrs.  Elizabeth, 
66,  66  note  2,  67 
Molesworth,  Hon.  John,  185, 
185  note  2,  201,  241 
Molesworth,  Robert  Moles¬ 
worth,  first  Viscount,  172, 
172  note  2,  188,  191,  244 
Montagu,  Hon.  Edward 
Wortley,  190, 190  note  2, 191 
Montgomery,  Sir  Robert,  84, 
84  note  1.  94 


INDEX 


263 


Moore,  Arthur,  8,  8  note  3,  19, 

20,  21 

Morley,  William,  243,  247 

Neville,  Grey,  174,  174  note  1 
Nicoll,  John,  211  note  3 
North  and  Grey,  Lord,  49,  193 

Ongley,  Sir  Samuel,  7,  7 

note  2,  9 

Onslow,  Arthur,  161,  197,  202, 
222,  234,  241 

Onslow,  Thomas  Onslow, 
second  Baron,  97,  97  note , 
Orleans,  Duke  of,  32,  33 
Ormonde,  Duchess  of,  27, 
27  note  1 

Osborne,  Captain  James,  211 
note  3 

Oxford,  Robert  Harley,  Earl 
of,  1,  1  note ,  7,  43,  52,  55, 
58,  62,  69,  99,  139,  156, 
191,  210,  211,  240 

Page,  Ambrose,  22,  27,  135, 
243 

Pearce,  Thomas,  211  note  3 
Pelham,  Hon.  Henry,  170, 
170  note 

Pels  (Dutch  banker),  152 
Pengelly,  Sir  Thomas,  191, 
191  note  2 

Pitt,  Hon.  Mrs.,  156,  156 
note  4 

Pitt,  George,  8,  8  note  6,  21 
Pitt,  Jane,  156,  156  note  3 
Pitt,  Robert,  174,  191 
Pitt,  Samuel,  Jr.,  211  note  3 
Platen,  Countess  of,  203,  213, 
213  note  2,  217 
Pope,  Alexander,  130,  218 
Portland,  Henry  Bentinck, 
first  Duke  of,  119,  158 
Pratt,  Sir  John,  199  note  1,  226 


Pretender,  The,  162 
Prie,  Marquis  de,  200,  202 
Prince  of  Wales  (afterwards 
George  II),  21,  26,  106,  151, 
168 

Prior,  Matthew,  120,  120  note 
1,  137,  218,  219 
Puckle,  James,  84,  84  note  1 
Pulteney,  Daniel  165,  167 
Pulteney,  David,  154,  154 

note  2,  185 

Pulteney,  William,  125,  127, 
154, 154  note  1, 165, 167, 170 


Radcliffe,  Dr.  John,  159  note  2 
Raper,  Matthew,  211  note  2 
Raymond,  Captain  Hugh,  22, 
27,  243,  247 

Read,  Samuel,  Jr.,  22,  27,  243 
Redmond,  Sir  Peter,  28 
Reynolds,  Thomas,  9,  9  note  2, 
21,  27,  200,  243,  247 
Robinson,  Sir  William,  189, 
189  note  1,  192 
Ross,  General  the  Hon.  C., 
191, 191  note  3 

Roxburgh,  John  Ker,  first 
Duke  of,  157 
Rudge,  John,  211  note  3 
Rutland,  John  Manners, 
second  Duke  of,  76,  76 

note  1 

St.  John,  Henry.  See  Boling- 
broke,  Viscount 
Sawbridge,  Jacob,  8,  8  note 

8,  21,  27,  176  note  2,  199, 
228,  243,  247 

Shepherd,  Samuel,  8,  8  note 

9,  18 

Shippen,  William,  171,  171 

note  1,  172,  188,  191,  209, 
238,  239,  242 


264 


INDEX 


Sloper,  William,  191,  191  note 
4,  239 

Stair,  John  Dalrymple,  second 
Earl  of,  32 

Stanhope,  James  Stanhope, 
Earl,  23,  23  note  1,  25,  28,  71, 
105,  157,  194,  204,  207,  208, 
216  note  1 

Stanhope,  Charles,  210,  213, 
220,  221,  229 

Stanhope,  Lord  (Philip  Dormer 
Stanhope),  221,  221  note  1 
Steele,  Sir  Richard,  46,  48,  89, 
175 

Strafford,  Thomas  Went¬ 
worth,  third  Earl  of,  116, 
116  note  1,  156,  166 
Strange  ways,  Colonel  Thomas, 
191,  191  note  5 
Stratford,  Francis,  8,  9 
Stratford,  Dr.  William,  64,  64 
note  1,  139,  140,  152,  153, 
156,  159,  198,  240 
Sunderland,  Lady,  67 
Sunderland,  Charles  Spencer, 
third  Earl  of,  50,  132,  162, 
163,  165,  167,  194,  202,  213, 
223,  230-235,  238,  255 
Surman,  Robert,  195,  199,  243 
Sutton,  Sir  Robert,  152 
Swift,  Jonathan,  11,  12,  144, 
150,  155 

Thompson,  Richard,  211  note  3 
Thomson,  Sir  William,  190, 
190  note  3 

Tillard,  William,  27,  243,  247 
Townshend,  Lord,  137,  160 
note  2,  177,  200,  205,  207 
Townshend,  Hon.  Horatio,  22 
Trench,  Fisher,  22,  22  note  2 
Tudman,  Benjamin,  8,  9 
Turner,  Elias,  199,  220,  228, 
247 


Turner,  John,  27,  243 

Vanbrugh,  Sir  John,  234,  237, 
238 

Vernon,  Sir  Charles,  226 
Vernon,  Thomas,  8,  8  note  10 
Victor  Amadeus,  King  of 
Sicily,  32 


Walker,  Mr.,  134 
Walker,  Sir  J.,  232 
Waller,  Edmund,  222,  227 
Walpole,  Horatio  Walpole, 
Baron,  174 

Walpole,  Sir  Robert,  25,  25 
note,  26,  39,  42,  43,  48,  97, 
106,  123,  137,  151,  160 
note  2,  164,  165,  167,  168, 
173,  176,  177,  178,  183,  184, 
185,  223,  225,  231,  232,  238, 
240,  253,  255 

Walsingliam,  Countess  of,  213 
note  1 

Ward,  Sir  John,  123, 123  note  1, 
253 

Watts,  Samuel,  211  note  4 
Westmorland,  Lord,  105,  110 
Wharton,  Philip,  Duke  of, 
49,  49  note  1,  157,  193,  194, 
207 

Williams,  Sir  John,  8,  8  note  11, 
WTillis,  Thomas,  211  note  3 
Wilmington,  Hon.  Spencer 
Compton,  Earl  of,  25 
Wilson,  Edward  (‘Beau’),  32, 
32  note  1,  64 
Windham,  Mrs.,  54,  110 
Windham,  Ashe,  54,  54  note  2, 
154,  157,  159,  168,  189 
Windham,  David,  154 
Windham,  James,  189 
Windham,  William,  154,  157, 
159,  168 


INDEX 


265 


Windsor,  Hon.  Dixie,  191,  191 
note  6 

Wishart,  Admiral  Sir  James, 
8,  8  note  12 

Wood,  Robert,  211  note  3 
Wortley,  Hon.  Edward.  See 
Montagu,  Hon.  Edward 
Wortley 


Wyndham,  Sir  William,  172, 
172  note  1 


Yonge,  Sir  William,  bart.,  240 
Yorke,  Philip,  173,  173  note  1 

Zinzendorf,  200 


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